When do firms benefit from university–industry R&D collaborations? The implications of firm R&D focus on scientific research and technological recombination

doi:10.1016/j.jbusvent.2013.11.001

Journal of Business Venturing

Volume 29, Issue 6, November 2014, Pages 807-821

https://doi.org/10.1016/j.jbusvent.2013.11.001 Get rights and content

Highlights

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We assess when university collaborations enhance a firm's patent performance.
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Technological recombination focus in firm R&D improves the collaborative benefits.
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Scientific research focus in firm R&D reduces the collaborative benefits.
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Younger firms focused on scientific research gain more collaborative benefits.
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Older firms focused on technological recombination gain more collaborative benefits.

Abstract

Firms' access to academic discoveries through R&D collaborations has been shown to enhance their patent performance. However, increasing both internal and external R&D activities can lead to high knowledge redundancy and coordination costs. This paper examines what kind of R&D focus inside the firm will improve or reduce the benefits of R&D collaborations with universities. Our results show that technological recombination focus strengthens the relationship between university collaborations and patent performance, whereas scientific research focus weakens the relationship. These results also differ between young and old firms, implying that firms may shift their R&D focus according to their collaborative objectives.

Section snippets

Executive summary

Prior studies that adopt the organizational learning and absorptive capacity perspectives show that firms with greater internal R&D activities gain more benefits from R&D collaborations with universities. However, recent evidence suggests that increasing overlap in resources and expertise between firms and universities can lead to knowledge redundancy and coordination costs, which can reduce the expected returns from university collaborations. Current literature on university–industry linkages

Theoretical background and hypotheses

University–industry collaborations in science and technology-based industrial sectors have long been recognized as an important source of economic growth (Cohen et al., 2002, Mansfield, 1995, Rosenberg and Nelson, 1994). Especially in life sciences, these collaborations act as a vehicle in transforming academic discoveries into commercially successful innovations (George et al., 2002, Kenney, 1986, Murray, 2002, Powell et al., 1996, Rothaermel and Deeds, 2004, Zucker et al., 2002). Rothaermel

Data

We collected data from multiple sources relevant to the biotechnology industry. The global biotechnology market experienced significant growth in the last decade. The total revenue of the global biotechnology market reached $200 billion in 2009, representing a compound annual growth rate of 10.2% between 2005 and 2009 (Datamonitor, 2010). The largest biotech market segment is the medical and health care applications, which account for 66.2% of the market's total value. Biotechnology also

Results

The dependent variable is forward patent citations, so a count data model is applied. We used a negative binomial model because the number of citations exhibits over-dispersion, as is often the case with patent research (Gittelman and Kogut, 2003). Cameron and Trivedi (1998) note that over-dispersion in the data can be attributed to unobserved heterogeneity; therefore, we include firm-level control variables to account for firm heterogeneity. Although the unit of analysis is individual patent,

Discussion and conclusion

In this research we seek to understand what kind of R&D focus inside the firm enhances or undermines the benefits arising from R&D collaborations with universities and accounts for variation in the firm's patent performance. Innovation scholars have traditionally emphasized the complementarity arising from combining in-house and external R&D (Arora and Gambardella, 1994, Cassiman and Veugelers, 2006, Rosenberg and Nelson, 1994). In other words, a firm's innovation performance is enhanced when

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^☆: We thank Johan Bruneel, Bart Clarysse, Elicia Maine, the reviewers and the field editor Philip Phan for their helpful comments and suggestions. We also thank the participants of R&D Management Conference 2013 and research seminar at Ghent University for helpful feedback. We are grateful to NUS (R-535-000-006-133) and SFU (876663) for their grant support, and we acknowledge the use of the NUS-MBS Patent Database. Errors remain our own.

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When do firms benefit from university–industry R&D collaborations? The implications of firm R&D focus on scientific research and technological recombination☆

Highlights

Abstract

Section snippets

Executive summary

Theoretical background and hypotheses

Data

Results

Discussion and conclusion

Res. Policy

J. Econ. Behav. Organ.

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Res. Policy

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Organ. Dyn.

J. Bus. Ventur.

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J. Bus. Ventur.

J. Bus. Ventur.

J. Manag.

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J. Account. Econ.

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J. Bus. Ventur.

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Res. Policy

Res. Policy

Res. Policy

A model of creativity and innovation in organizations

Complementarity and external linkages: the strategies of the large firms in biotechnology

J. Ind. Econ.

Universities as research partners in publicly supported entrepreneurial firms

Econ. Innov. New Technol.

Don't go it alone: alliance network composition and startups' performance in Canadian biotechnology

Strateg. Manag. J.

Patents, real options and firm performance

Econ. J.

Networks, propinquity, and innovation in knowledge-intensive industries

Adm. Sci. Q.

Regression Analysis of Count Data

Where do firms' recombinant capabilities come from? Intraorganizational networks, knowledge, and firms' ability to innovate through technological recombination: origins of firms' recombinant capabilities

Strateg. Manag. J.

In search of complementarity in innovation strategy: internal R&D and external knowledge acquisition

Manag. Sci.

Absorptive capacity, co-authoring behavior and the organization of research in drug discovery

J. Ind. Econ.

Patents, thickets and the financing of early-stage firms: evidence from the software industry

J. Econ. Manag. Strateg.

Innovation and learning: the two faces of R&D

Econ. J.

Links and impacts: the influence of public research on industrial R&D

Manag. Sci.

Knowledge portfolios and the organization of innovation networks

Acad. Manag. Rev.

Toward a new economics of science

Res. Policy

Industry Profile: Global Biotechnology, Datamonitor, Reference Code 0199-0695, May 2010

The relational view: cooperative strategy and sources of interorganizational competitive advantage

Acad. Manag. Rev.

Recombinant uncertainty in technological search

Manag. Sci.

Science as a map of technological search

Strateg. Manag. J.