Do latecomer firms rely on ‘recent’ and ‘scientific’ knowledge more than incumbent firms do? Convergence or divergence in knowledge sourcing

Abstract

This study deals with the convergence and divergence issue in terms of the possible difference in the knowledge-sourcing behaviour of latecomer and incumbent firms. Consequently, empirical analysis using the patent citation data shows that no significant difference exists in the knowledge-sourcing behaviour of the incumbents and latecomers in long-cycle time-based sectors, particularly in terms of whether each type of firm relies more or less on ‘recent’ and ‘scientific’ knowledge. By contrast, a significant difference is observed in the short-cycle technology-based sectors, such that the latecomer firms tend to rely more on ‘recent’ and ‘scientific’ knowledge than the incumbents. Thus, the findings suggest that the answer to the question of whether convergence or divergence exists in knowledge sourcing is that it depends on the knowledge regime of the sectors, specifically on the cycle time of the technologies of sectors. This finding is consistent with the reasoning that the latecomer firms can afford to rely only on recent technologies in short-cycle sectors in which technologies tend to change quickly or become obsolete; latecomer firms are also keen on their knowledge sourcing to broadly search not only into technological knowledge (patents) but also into scientific knowledge (articles) in short-cycle sectors with rapid change of technologies.