The interaction between external and internal knowledge sources: an open innovation view

Purpose – The purpose of this paper is to study the external sources of knowledge that better exploit internal knowledge in order to innovate. Design/methodology/approach – A balanced panel of 1,266 firms that respond to the Survey of Business Strategies for a five-year period was used, which represents a total of 6,330 observations. Findings – The influence of the absorptive capacity on new products is significant, with an inverted U-shaped relationship. The interaction between external sources of knowledge and firm ' s absorptive capacity has a negative effect on innovation up to a certain level (substitution effect), after which that interaction improves the innovation of firms, displaying a complementary effect. Practical implications – Firms with excess of internal sources of knowledge do not obtain better innovative results because overtime firms tend to inertia and need external sources of knowledge to obtain new knowledge. Firms must be conscious that the effect on innovation of using a strategy o...

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