Framework of open innovation in SMEs in an emerging economy: firm characteristics, network openness, and network information

Abstract

As the argument regarding the effect of firm size on the effectiveness of innovation continues, the particularities of open innovation from the perspective of emerging market small and medium enterprises (EM SMEs) must be addressed. We propose a network framework by bridging the resource-based view and the social network perspective with their respective emphases on the importance of EM SME innovation capacity. Specifically, we address this gap by exploring the incidence of and trends toward open innovation, using a survey data of 420 innovative SMEs of China. Our study supports open innovation from the social network perspective and shows the open innovation of considering important choices for SMEs in the emerging market setting. Our analyses of Chinese SMEs data largely support our theoretical framework and demonstrate the importance of factors across firm characteristics (innovation capacity and innovation barriers), network openness, and network information in understanding open innovation in EM SMEs.