Knowledge Sharing and Value Flow in the Software Industry: Searching the Patent Citation Network

A firm's innovative capabilities depend on its ability to learn from the environment. To learn from the environment a firm must have access to external knowledge, and it must have the absorptive capacity to identify, assimilate and exploit such knowledge. While previous research recognized that firms must invest to acquire absorptive capacity, it assumed that access to knowledge spillovers is free, or a perfectly correlated component of R&D investments. We argue that a firm must also invest in developing organizational routines that search for and acquire access to knowledge spillover. In order to explore the relationship between own-knowledge development and search, we examine the relationship between software firms' R&D investments and their position within the patent citation network and their subsequent knowledge development and financial performance. The results show that a firm's position within the knowledge flow of the industry helps predict knowledge development and financial performance.

[1]  D. Teece,et al.  DYNAMIC CAPABILITIES AND STRATEGIC MANAGEMENT , 1997 .

[2]  B. Uzzi,et al.  The Sources and Consequences of Embeddedness for the Economic Performance of Organizations: The Network Effect , 1996 .

[3]  Stanley Wasserman,et al.  Social Network Analysis: Methods and Applications , 1994, Structural analysis in the social sciences.

[4]  Z. Griliches,et al.  Industry Effects and Appropriability Measures in the Stock Markets Valuation of R&D and Patents , 1987 .

[5]  野中 郁次郎,et al.  The Knowledge-Creating Company: How , 1995 .

[6]  B. Kogut,et al.  Knowledge and the Speed of the Transfer and Imitation of Organizational Capabilities: An Empirical Test , 1995 .

[7]  Daniel A. Levinthal,et al.  The myopia of learning , 1993 .

[8]  Devi R. Gnyawali,et al.  Cooperative Networks and Competitive Dynamics: a Structural Embeddedness Perspective , 2001 .

[9]  Steven B. Andrews,et al.  Structural Holes: The Social Structure of Competition , 1995, The SAGE Encyclopedia of Research Design.

[10]  D. Lax.  Robust Estimators of Scale: Finite-Sample Performance in Long-Tailed Symmetric Distributions , 1985 .

[11]  E. Hippel.  Sticky Information and the Locus of Problem Solving: Implications for Innovation , 1994 .

[12]  D. Teece.  Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy , 1993 .

[13]  I. Cockburn,et al.  Measuring competence?: exploring firm effects in pharmaceutical research , 1994 .

[14]  E. von Hippel,et al.  Sources of Innovation , 2016 .

[15]  Daniel A. Levinthal,et al.  Innovation and Learning: The Two Faces of R&D , 1989 .

[16]  J. Coleman,et al.  Social Capital in the Creation of Human Capital , 1988, American Journal of Sociology.

[17]  Manuel Trajtenberg,et al.  Patents, Citations, and Innovations: A Window on the Knowledge Economy , 2002 .

[18]  Mariko Sakakibara,et al.  Formation of R&D consortia: industry and company effects , 2002 .

[19]  S. Zahra,et al.  Absorptive Capacity: A Review, Reconceptualization, and Extension , 2002 .

[20]  Juan Alcácer,et al.  Knowledge Seeking and Location Choice of Foreign Direct Investment in the United States , 2002, Manag. Sci..

[21]  Eric W. K. Tsang.  Acquiring Knowledge by Foreign Partners from International Joint Ventures in a Transition Economy: Learning-by-Doing and Learning Myopia , 2002 .

[22]  Robert D. Miewald.  Administrative Science Quarterly , 1981 .

[23]  L. Freeman,et al.  Centrality in valued graphs: A measure of betweenness based on network flow , 1991 .

[24]  Mark S. Granovetter.  The Strength of Weak Ties , 1973, American Journal of Sociology.

[25]  W. Powell,et al.  Interorganizational Collaboration and the Locus of Innovation: Networks of Learning in Biotechnology. , 1996 .

[26]  Wesley M. Cohen,et al.  Empirical studies of innovation and market structure , 1989 .

[27]  N. Smelser,et al.  Annual Review of Sociology , 1975 .

[28]  B. Kogut,et al.  Knowledge of the Firm, Combinative Capabilities, and the Replication of Technology , 1992 .

[29]  K. Eisenhardt,et al.  Resource-based View of Strategic Alliance Formation: Strategic and Social Effects in Entrepreneurial Firms , 1996 .

[30]  K. Arrow.  Economic Welfare and the Allocation of Resources for Invention , 1962 .

[31]  A. Drejer.  Innovation and learning , 2003 .

[32]  A. Nerkar,et al.  Beyond local search: boundary‐spanning, exploration, and impact in the optical disk industry , 2001 .

[33]  S. Winter,et al.  Appropriating the Returns from Industrial Research and Development , 1987 .

[34]  Alexander Tuzhilin,et al.  Using Query-Driven Simulations for Querying Outcomes of Business Processes , 1996, Decis. Support Syst..

[35]  Erik Brynjolfsson,et al.  Information assets, technology, and organization , 1994 .

[36]  M. Lynn.  Hawaii International Conference on System Sciences , 1996 .

[37]  R. Eccles,et al.  Networks and Organizations: Structure, Form, and Action , 1992 .

[38]  Robert M. Hunt,et al.  An Empirical Look at Software Patents , 2004 .

[39]  Bala Iyer,et al.  Competing in the Era of Emergent Architecture: The Case of Packaged Software Industry , 2007, 2007 40th Annual Hawaii International Conference on System Sciences (HICSS'07).

[40]  Joel A. C. Baum,et al.  Where Do Small Worlds Come From? , 2003 .

[41]  John Scott.  What is social network analysis , 2010 .

[42]  O. Williamson.  Markets and hierarchies, analysis and antitrust implications : a study in the economics of internal organization , 1975 .

[43]  T. Allen.  Managing the flow of technology , 1977 .

[44]  Edwin Mansfield,et al.  Industrial R&D in Japan and the United States: A Comparative Study , 1988 .

[45]  Daniel A. Levinthal,et al.  ABSORPTIVE CAPACITY: A NEW PERSPECTIVE ON LEARNING AND INNOVATION , 1990 .

[46]  Bala Iyer,et al.  Make Way for the Penguin? Explaining Commitment to Linux by Independent Software Companies , 2004 .

[47]  A. Saxenian.  The origins and dynamics of production networks in Silicon Valley , 1991 .

[48]  G. Ahuja.  Collaboration Networks, Structural Holes, and Innovation: A Longitudinal Study , 1998 .

[49]  Daniel A. Levinthal,et al.  Exploration and Exploitation in Organizational Learning , 2007 .

[50]  Z. Griliches.  Patent Statistics as Economic Indicators: a Survey , 1990 .