External knowledge sourcing from innovation cooperation and the role of absorptive capacity: empirical evidence from Norway and Sweden

Abstract

Open innovation (OI) is an innovation paradigm which argues that firms should use external knowledge in order to succeed in the innovation process. It is currently unclear however how firms are able to source external knowledge from external actors when attempting to innovate. In this paper we examine the relationship between absorptive capacity and firms’ ability to enter into innovation cooperation with external actors. Our econometric results show that internal R&D, training and an educated workforce, as core aspects of firms’ absorptive capacity, are positively associated with (the intensity of) innovation cooperation. An implication is that external knowledge does not enter the firm freely. The costs firms must invoke in order to be able to source external knowledge in the OI context is considerable. Without investing in internal R&D, training and recruiting workers with good educational qualifications, firms may not be able to follow the open approach to innovation.