Innovativeness in International Joint Venture: The effect of explicit and tacit knowledge transfer

Abstract

The purpose of this paper is to explore the relationships between tacit knowledge, explicit knowledge, and innovativeness of International Joint Ventures (IJVs) based on knowledge-based and learning theories. In the context of IJVs, explicit and tacit knowledge transfer related to innovativeness still is complicated by many challenges. We conducted a survey of 199 IJVs in South Korea. A structural equation model was used to test hypothesized linkages. Our results confirm that explicit knowledge transfer is positively associated with innovativeness. The explicit knowledge transferred from the foreign parent to the IJV has a stronger impact on innovativeness than tacit knowledge does. Additionally, tacit knowledge proved to not exhibit a direct impact on innovativeness of IJVs. The results provide strong support for the mediating role of explicit knowledge in the relationship between tacit knowledge transfer and an IJV’s innovativeness. Finally, we find that the transfer of tacit knowledge has a significant effect only on the innovativeness of IJVs with a high level of international work experience.