Abstract

In this article, I examine the implications that competition and contacts on behalf of firms in multiple markets have upon assumptions underlying the principles of open innovation. Ultimately, I propose to integrate conceptual viewpoints from the multimarket contact paradigm into the open innovation model in order to raise the explanatory power of the latter. The study investigates how inter-firm competition and contacts on multiple markets can act as a trigger for R&D contractual agreements. The accompanying hypotheses are tested through an intra-industry analysis, finding that multi-market contact is curvilinear (taking an inverted U-shape) related to the development of R&D agreements among competing firms. I also explore the role of firm’s patents stock as a key intervening variable in the relationship between MMC and R&D contractual agreements.

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