Technological Capabilities, Technological Dynamism and Innovation Offshoring

Torben Schubert (), Elisabeth Baier () and Christian Rammer
Additional contact information
Torben Schubert: CIRCLE, Lund University, Postal: CIRCLE, Lund University, PO Box 117, SE-22100 Lund, Sweden
Elisabeth Baier: Hochschule für Wirtschaft, Technik und Kultur (HWTK), Postal: Germany

No 2016/22, Papers in Innovation Studies from Lund University, CIRCLE - Centre for Innovation Research

Abstract: In this paper we analyze the conditions under which firms decide to offshore innovation. We consider the role of internal technological capabilities and technological dynamism in the firm environment, distinguishing speed and uncertainty of technological change. Using unique data from the German Innovation Survey we find that while high speed of technological change tends to drive innovation offshoring, high uncertainty about future technology developments results in more innovation offshoring only for firms with low internal technological capabilities. Firms with high technological capabilities instead are less likely to offshore innovation when uncertainty is high. We argue that these differences in offshoring behaviour reflect differing strategic objectives. We show that for firms with low technological capabilities asset augmentation is more important while for firms with high technological capabilities asset exploitation is more important. When faced by high technological uncertainty firms with low technological capabilities offshore innovation strategically in order to reduce uncertainty by augmenting their asset base. For firms with high technological capabilities asset augmentation is less important. When faced by high technological uncertainty, they prefer to innovate onshore in order to keep stronger control of their key assets.

Keywords: offshoring; R&D; uncertainty; competition; technological change; speed (search for similar items in EconPapers)
JEL-codes: F21 F23 L22 O32 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2016-07-25
New Economics Papers: this item is included in nep-ino, nep-sbm and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://wp.circle.lu.se/upload/CIRCLE/workingpapers/201713_schubert_et_al.pdf (application/pdf)

Related works:
Working Paper: Technological capabilities, technological dynamism and innovation offshoring (2016)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hhs:lucirc:2016_022

Access Statistics for this paper

More papers in Papers in Innovation Studies from Lund University, CIRCLE - Centre for Innovation Research CIRCLE - Centre for Innovation Research, Lund University, PO Box 117, SE-22100 Lund, Sweden. Contact information at EDIRC.
Bibliographic data for series maintained by Torben Schubert ().