Knowledge search, spillover and creation capability in India's pharmaceutical industry

Abstract

This paper examines the relationship between knowledge creation capability and both knowledge search as well as knowledge spillover effects. It investigates three research questions: (1) How does knowledge search of a firm affect the firm's knowledge creation capability? (2) How do knowledge spillovers impact the firm's knowledge creation capability and (3) Which effect – knowledge search or knowledge spillover – is greater on the firm's knowledge creation capability? To discuss these questions, it draws data from the pharmaceutical industry in India. Based on patent and citation data from the US Patents and Trademark Office, from 1979 to 2009, empirical results demonstrate that knowledge search and knowledge spillover do have positive effects on knowledge creation capability with the former having greater effects than the latter. It concludes with a discussion of the theoretical and practical implications of this study and suggestions for future works.