IDEAS home Printed from https://ideas.repec.org/p/rif/wpaper/25.html
   My bibliography  Save this paper

Knowledge Complementarity of a Firm’s Internal and External R&D Capabilities

Author

Listed:
  • Koski, Heli
  • Svento, Rauli

Abstract

We use data from over 1500 Finnish companies for the years 2006-2008 and 2008-2010 to explore complementarity of a firm’s R&D strategy with its external knowledge acquisition and innovation collaboration strategies. We define knowledge complementarity (tacit knowledge complementarity) of R&D capabilities to exist when increase in investments in R&D also increases marginal returns from broader external knowledge search (deeper innovation collaboration with external partners). Our estimation results provide support for knowledge complementarity of external R&D. Instead, our data provide no evidence on tacit knowledge complementary of external R&D generally. However, our empirical results concerning the separate types of external R&D suggest that a firm’s acquisition of new technology (i.e., advanced machinery, equipment or software) for innovation purposes appears to be tacit knowledge complementary.

Suggested Citation

  • Koski, Heli & Svento, Rauli, 2014. "Knowledge Complementarity of a Firm’s Internal and External R&D Capabilities," ETLA Working Papers 25, The Research Institute of the Finnish Economy.
    • Handle: RePEc:rif:wpaper:25
    as

    Download full text from publisher

    File URL: http://www.etla.fi/wp-content/uploads/ETLA-Working-Papers-25.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Marco Ceccagnoli & Matthew J. Higgins & Vincenzo Palermo, 2014. "Behind the Scenes: Sources of Complementarity in R&D," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 23(1), pages 125-148, March.
    2. Gianni Lorenzoni & Andrea Lipparini, 1999. "The leveraging of interfirm relationships as a distinctive organizational capability: a longitudinal study," Strategic Management Journal, Wiley Blackwell, vol. 20(4), pages 317-338, April.
    3. Olivier Bertrand & Michael J. Mol, 2013. "The antecedents and innovation effects of domestic and offshore R&D outsourcing: The contingent impact of cognitive distance and absorptive capacity," Strategic Management Journal, Wiley Blackwell, vol. 34(6), pages 751-760, June.
    4. Dahlander, Linus & Gann, David M., 2010. "How open is innovation?," Research Policy, Elsevier, vol. 39(6), pages 699-709, July.
    5. Prashant Kale & Harbir Singh, 2007. "Building firm capabilities through learning: the role of the alliance learning process in alliance capability and firm‐level alliance success," Strategic Management Journal, Wiley Blackwell, vol. 28(10), pages 981-1000, October.
    6. Maidique, Modesto A. & Zirger, Billie Jo, 1985. "The new product learning cycle," Research Policy, Elsevier, vol. 14(6), pages 299-313, December.
    7. Aija Leiponen & Constance E. Helfat, 2010. "Innovation objectives, knowledge sources, and the benefits of breadth," Strategic Management Journal, Wiley Blackwell, vol. 31(2), pages 224-236, February.
    8. Kevin Zheng Zhou & Caroline Bingxin Li, 2012. "How knowledge affects radical innovation: Knowledge base, market knowledge acquisition, and internal knowledge sharing," Strategic Management Journal, Wiley Blackwell, vol. 33(9), pages 1090-1102, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ardito, Lorenzo & Messeni Petruzzelli, Antonio, 2017. "Breadth of external knowledge sourcing and product innovation: The moderating role of strategic human resource practices," European Management Journal, Elsevier, vol. 35(2), pages 261-272.
    2. Philipp Nitzsche & Bernd W. Wirtz & Vincent Göttel, 2016. "Innovation Success In The Context Of Inbound Open Innovation," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 20(02), pages 1-38, February.
    3. Caroline Danièle Mothe & Thuc Uyen Nguyen-Thi, 2017. "Persistent openness and environmental innovation: An empirical analysis of French manufacturing firms," Post-Print hal-01609129, HAL.
    4. Haji Ali Beigi, Maryam, 2021. "Is more diverse always the better? External knowledge source clusters and innovation performance in Germany," Ilmenau Economics Discussion Papers 156, Ilmenau University of Technology, Institute of Economics.
    5. Zhu, Xiaoxuan & Xiao, Zhenxin & Dong, Maggie Chuoyan & Gu, Jibao, 2019. "The fit between firms’ open innovation and business model for new product development speed: A contingent perspective," Technovation, Elsevier, vol. 86, pages 75-85.
    6. Yan, Tingting & Azadegan, Arash, 2017. "Comparing inter-organizational new product development strategies: Buy or ally; Supply-chain or non-supply-chain partners?," International Journal of Production Economics, Elsevier, vol. 183(PA), pages 21-38.
    7. Flor, M. Luisa & Cooper, Sarah Y. & Oltra, María J., 2018. "External knowledge search, absorptive capacity and radical innovation in high-technology firms," European Management Journal, Elsevier, vol. 36(2), pages 183-194.
    8. Kim, Bongsun & Kim, Eonsoo & Foss, Nicolai J., 2016. "Balancing absorptive capacity and inbound open innovation for sustained innovative performance: An attention-based view," European Management Journal, Elsevier, vol. 34(1), pages 80-90.
    9. Xie, Xuemei & Wang, Lijun & Zeng, Saixing, 2018. "Inter-organizational knowledge acquisition and firms' radical innovation: A moderated mediation analysis," Journal of Business Research, Elsevier, vol. 90(C), pages 295-306.
    10. MOTHE Caroline & NGUYEN Thi Thuc Uyen, 2016. "Openness and environmental innovation: Does time-horizon matter?," LISER Working Paper Series 2016-13, Luxembourg Institute of Socio-Economic Research (LISER).
    11. Luyun Xu & Jian Li & Xin Zhou, 2019. "Exploring new knowledge through research collaboration: the moderation of the global and local cohesion of knowledge networks," The Journal of Technology Transfer, Springer, vol. 44(3), pages 822-849, June.
    12. Eungdo Kim & InGyu Lee & Hongbum Kim & Kwangsoo Shin, 2021. "Factors Affecting Outbound Open Innovation Performance in Bio-Pharmaceutical Industry-Focus on Out-Licensing Deals," Sustainability, MDPI, vol. 13(8), pages 1-17, April.
    13. Rogbeer, Shalini & Almahendra, Rangga & Ambos, Björn, 2014. "Open-Innovation Effectiveness: When does the Macro Design of Alliance Portfolios Matter?," Journal of International Management, Elsevier, vol. 20(4), pages 464-477.
    14. van Criekingen, Kristof & Freel, Mark & Czarnitzki, Dirk, 2021. "Open innovation deficiency: Evidence on project abandonment and delay," ZEW Discussion Papers 21-006, ZEW - Leibniz Centre for European Economic Research.
    15. A. Lasagni, 2011. "European SMEs, external relationships and innovation: some empirical evidence," Economics Department Working Papers 2011-EP04, Department of Economics, Parma University (Italy).
    16. Jakob Pohlisch, 2020. "Internal Open Innovation—Lessons Learned from Internal Crowdsourcing at SAP," Sustainability, MDPI, vol. 12(10), pages 1-22, May.
    17. Colin C. J. Cheng & Eric C. Shiu, 2021. "Establishing a typology of open innovation strategies and their differential impacts on innovation success in an Asia-Pacific developed economy," Asia Pacific Journal of Management, Springer, vol. 38(1), pages 65-89, March.
    18. Andreea N. Kiss & Dirk Libaers & Pamela S. Barr & Tang Wang & Miles A. Zachary, 2020. "CEO cognitive flexibility, information search, and organizational ambidexterity," Strategic Management Journal, Wiley Blackwell, vol. 41(12), pages 2200-2233, December.
    19. J. Nils Foege & Erk P. Piening & Torsten-Oliver Salge, 2017. "Don’T Get Caught On The Wrong Foot: A Resource-Based Perspective On Imitation Threats In Innovation Partnerships," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 21(03), pages 1-42, April.
    20. Louise Lindbjerg & Theodor Vladasel, 2021. "Hiring Entrepreneurs for Innovation," Working Papers 1309, Barcelona School of Economics.

    More about this item

    Keywords

    open innovation; external knowledge search; complementarity;
    All these keywords.

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rif:wpaper:25. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Kaija Hyvönen-Rajecki (email available below). General contact details of provider: https://edirc.repec.org/data/etlaafi.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.