Governance of Innovation in the Presence of Internationalization in Innovation Activities



This paper summarizes the main results concerning different forms of knowledge sharing and transfer across firms such as technology licensing, joint R&D and R&D offshoring. Our analysis summarizes the main motivations and the barriers to licensing from the perspective of both sides of the market, licensees and licensors. Our research shows that the difficulty to evaluate technology and the information asymmetry between the parties are important obstacles to licensing along with the costs of assimilation and integration of technology. The risk of opportunism and holdup are particularly important for smaller firms.
The paper reports the main findings of the analysis of R&D collaboration by focusing on the reasons for persistence of collaboration over time. Persistence is positively associated with the use of external sources of knowledge in the innovative activity, participation in R&D projects supported by national agencies or European institutions and a high labor productivity. R&D cooperation, especially with domestic partners, universities, public research organizations and industrial labs is strongly associated with firms‟ innovative output.
Finally, the paper illustrates the main factors driving R&D offshoring to China and India by European firms: local technical skills, labor cost and the high potential size of the domestic market. In general the level of autonomy of subsidiaries is limited, although on some occasions solutions designed for the host markets have been absorbed and transferred across the global network of corporate subsidiaries. The main problems emerged from the cases examined are about human resource management (high turnover rates and a high variance in the quality of local skills), IPR protection, especially in China, and differences between the host and the home country in technical standards.
The paper concludes with some managerial implications emerging from the comparison of different technologies, industries, countries and firms.
Contact information:
Ingrid Verheul