Abstract
This paper assesses the extent to which the organization of the innovation effort in firms, as well as the geographical scale at which this effort is pursued, affects the capacity to benefit from product innovations. Three alternative modes of organization are studied: hierarchy, market and triple-helix-type networks. Furthermore, we consider triple-helix networks at three geographical scales: local, national and international. These relationships are tested on a random sample of 763 firms located in five urban regions of Norway which reported having introduced new products or services during the preceding 3 years. The analysis shows that firms exploiting internal hierarchy or triple-helix networks with a wide range of partners managed to derive a significantly higher share of their income from new products, compared to those that mainly relied on outsourcing within the market. In addition, the analysis shows that the geographical scale of cooperation in networks, as well as the type of partner used, matters for the capacity of firms to benefit from product innovation. In particular, firms that collaborate in international triple-helix-type networks involving suppliers, customers and R&D institutions extract a higher share of their income from product innovations, regardless of whether they organize the processes internally or through the network.
Highlights
Firm organization matters for innovation and for the returns that firms can extract from generating and/or adopting innovation
Firms which develop external links connecting them with other firms, knowledge-creating centres, such as research centres and universities, and government bodies often find themselves at the centre of complex triple-helix networks which facilitate their capacity to innovate (Etzkowitz 2008; Leydesdorff 2000)
For collaboration in triple-helix networks, we find that geography is important, but in ways which have tended to be eschewed by previous analyses
Summary
Firm organization matters for innovation and for the returns that firms can extract from generating and/or adopting innovation. We analyse the extent to which the prevalence of different organizations of innovation in the firm (market, hierarchy and triple-helix-networks (Powell 1990; Williamson 1991)) and the scope of the triple-helix networks, in terms of geography (links at local, national and international level) or types of partner (other firms, consultancies and R&D institutions), affect the share of income a firm derives from new products developed during the past 3 years.
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