The impact of open innovation on employee mobility and entrepreneurship

Prior research shows that firms can increase their innovation performance by leveraging external sources of knowledge. However, insights related to potential drawbacks of open collaborative approaches for innovation remain scarce. In this paper, we investigate the relationship between R&D collaboration and the departure of skilled employees. Highly qualified scientists and engineers who interact with external partners in the context of R&D collaborations may increase their outside options, resulting in higher rates of employee mobility to other firms and employee entrepreneurship. We analyze our research question using data from the Swedish edition of the Community Innovation (CIS) survey combined with employer-employee register data. Our econometric analysis suggests that a stronger use of research collaborations by firms leads to an increasing number of employee departures. Moreover, we detect heterogeneity for this relationship with respect to the types of employee exits and different collaboration partners.