Optimal cognitive distance and absorptive capacity

Abstract

Document VersionPublisher's PDF, also known as Version of Record (includes final page, issue and volume numbers) Please check the document version of this publication:• A submitted manuscript is the author's version of the article upon submission and before peer-review. There can be important differences between the submitted version and the official published version of record. People interested in the research are advised to contact the author for the final version of the publication, or visit the DOI to the publisher's website.• The final author version and the galley proof are versions of the publication after peer review.• The final published version features the final layout of the paper including the volume, issue and page numbers. Link to publication General rightsCopyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights.• Users may download and print one copy of any publication from the public portal for the purpose of private study or research.• You may not further distribute the material or use it for any profit-making activity or commercial gain • You may freely distribute the URL identifying the publication in the public portal ? Take down policyIf you believe that this document breaches copyright please contact us providing details, and we will remove access to the work immediately and investigate your claim. This paper tests hypotheses that in inter-firm alliances innovative performance is aninverted-U shaped function of cognitive distance, that the resulting optimal cognitive distance is higher for exploratory than for exploitative learning, and that optimal cognitive distance depends on absorptive capacity. Most hypotheses are confirmed for 994 alliances in several industries, in the period 1986-1996. The results indicate a new hypothesis that with more knowledge one needs larger cognitive distances to find novelty.

The cognitive and geographical structure of knowledge links and how they influence firms’ innovation performance

“…Meyer-Krahmer 1985, Arndt-Sternberg 2000, Bathelt et al 2004) as well as cognitively proximate and distant partners (cf. Fritsch 2003, Nooteboom et al 2007, Balland et al 2013). Especially, the economic relevance of the type of partner (in terms of the proximity dimensions) has been the focus of researchers.…”

“…Phelps (2010) found that access to greater variety improves innovation activities. Nooteboom et al (2007) and Broekel & Boschma (2012) provided evidence that, in terms of innovative success, an optimal level of cognitive proximity might exist. That is, both higher cognitive proximity (greater technological similarity) and lower cognitive proximity (lower technological similarity) tend to reduce the innovation performance of firms.…”

“…This is not only relevant from a theoretical perspective but it also matters empirically. For instance, many studies that test for the effect of cognitive proximity estimate the average technological similarity (cognitive distance) of a focal firm to its direct knowledge exchange partners (Nooteboom et al 2007, Broekel-Boschma 2012. However, the estimated average can be identical for very different distributions.…”

“…the potential for the creation of novel ideas and solutions. In this context, some cognitive distance is necessary for facilitating interactive learning and innovation (Nooteboom 2000). The other proximity types (i.e.…”

The Aims and Scope of Evolutionary Economic Geography

“…This may depend on, among other things, the degree of proximity between the networks partners. While a high degree of any form of proximity might be considered a prerequisite to make agents interact, proximity between agents does not necessarily increase their innovative performance, and may possibly even harm it (Grabher and Stark, 1997;Boschma, 2005;Cantner and Meder, 2007;Nooteboom et al, 2007;Broekel and Meder, 2008). This is in line with what Gilsing et al (2007) found when they assessed the impact of technological distance in high-tech alliance networks on the innovative performance of the partner firms.…”