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The innovative performance of firms in heterogeneous environments: The interplay between external knowledge and internal absorptive capacities

Riccardo Crescenzi and Luisa Gagliardi

Research Policy, 2018, vol. 47, issue 4, 782-795

Abstract: This paper investigates the link between firm-level innovative performance and innovation prone external environments where knowledgeable individuals tend to cluster. Organizational ambidexterity and absorptive capacities (potential and realized) make it possible for firms to leverage the availability of external knowledge and boost their innovation performance. The empirical analysis focuses on England and is based on a novel combination of Community Innovation Survey (CIS) firm-level data and patent data. The results show that only firms complementing potential and realized absorptive capacities are able to take advantage of favorable external environments by actively combining internal and external sources of knowledge.

Keywords: Innovation; Geography of innovation; Absorptive capacities; Exploration and exploitation (search for similar items in EconPapers)
Date: 2018
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