The role of international networks in upgrading national innovation systems

Abstract

Technological learning within national innovation systems (NIS) stands at the core of technological upgrading at the firm and economy level. The common understanding is that NIS are the primary source of technological knowledge acquisition for innovating firms, but the opening of economies, the globalization of innovation networks, and the rapid internationalization of innovative firms challenge this view -- especially with respect to small open economies in transition. We applied PLS-SEM to data from 131 R&D intensive firms responding to a survey investigating the mediating role of international networks for technological learning within Lithuania's NIS. The findings demonstrate a full mediating role of global innovation system networks in facilitating technological learning within NIS, partially contradicting the prevailing understanding of the primary importance of NIS based networks for firm learning. Technological learning of firms, and thus the upgrading of the NIS they are embedded in, relies more on international networks than previously assumed. These results call for a more careful design and facilitation of technological learning networks, recognizing global networks as a complementary and necessary component in NIS upgrading. This study contributes to the literature of technological learning within national innovation systems, with a special focus on R&D intensive firms leading the technological upgrading of a country's NIS.