Who co-operates for innovation, and why: An empirical analysis
Introduction
In recent years, there has been growing interest in co-operative arrangements for innovation. Some commentators, such as Teece (1992), have argued that the rise of these relationships has overturned our existing understanding of the organisation of innovation. Innovation is seen as becoming increasingly distributed, as fewer firms are able to ‘go it alone’ in technological development. This in turn means the old debates about firm-size, market structure and innovation are becoming outmoded, as the boundaries of the firm are becoming increasingly ‘fuzzy’.
This paper examines these arguments through an analysis of the pattern of co-operation arrangements for innovation amongst the innovating firms that responded to the UK’s version of the second European community innovation survey (CIS-2). The CIS-2 was the UK’s first successful wide-scale and official survey of firms’ innovation activities. In this paper, we are concerned with mapping the presence or absence of co-operative arrangements for innovation between firms and various types of external partner, and with investigating the features of the firms that relate to their participation in such relationships. Unfortunately, data restrictions mean we are not able to directly assess how significant these relationships were to the innovation activities of the firms, nor how successful the co-operations were. Moreover, we can also only indirectly understand the motives the firms had in establishing these relationships. On the positive side, however, we are able to extend the analysis beyond manufacturing to include service firms.
The paper is structured as follows. Section 1 provides an introduction to the data and the headline findings from it with respect to co-operation arrangements between innovating firms and external partners. Section 2 then provides an overview, from existing research, of the motivations for entering into co-operative arrangements for innovation. Section 3 discusses the range of factors available from the survey that might be expected to influence engagement in these arrangements, whilst multivariate analyses of the data are undertaken in Section 4. Finally, some conclusions are provided.
Section snippets
The data and the headline findings
The data-set examined here is the UK response to the second CIS-2, which was based on the revised version of the OECD’s Oslo Manual (OECD, 1996). The survey was carried out in 1997 for the UK Government by the Office for National Statistics (ONS) and according to a common European framework.
The survey covered both manufacturing and services, with similar questionnaires sent to firms in both sectors. Firms engaged in mining and quarrying, construction, recycling, and the water, gas and
An overview of research on co-operative arrangements for innovation
Co-operative arrangements for innovation, including strategic technological alliances, became the focus of considerable theoretical and empirical attention during the 1980s and 1990s, and many analysts assume these arrangements represent new ways of organising (technological) innovation. However, Dodgson (1994; see also Freeman, 1991) points out that formal collaborative arrangements for innovation have a long history. Moreover, studies of innovation have long recognised innovation is to some
The variables for the multivariate analysis
Having provided an overview of the general motivations for co-operation agreements with external partners, we now introduce the various characteristics of the innovating firms (that the UK CIS-2 enquired about), and consider how these might relate to the propensities of firms to enter into co-operative arrangements for innovation.
The multivariate analysis
For the multivariate analysis, the variables for which are summarised in Table 2, we began with a logistic regression identifying the firms amongst the whole sample of respondents which engaged in innovation activities (as defined in Section 1). This regression includes only the background characteristics of the firms (i.e. size, age, ownership and sector of activity) as the explanatory variables (Table 3). It shows that, as expected, the propensity to engage in innovation activities increased
Concluding discussion
We began this paper with the observation that some commentators now argue innovation is no longer the province of individual firms, but is a matter of collective action, with firms acting together with suppliers, customers, competitors, consultants and/or universities in co-operative arrangements for innovation. However, in direct contrast, recent empirical evidence suggests such collaborations are far from the norm. Craggs and Jones (1998) report that less than a fifth of the innovating firms
Acknowledgements
I would like to thank the UK Government’s Department of Trade and Industry (DTI), and in particular Dr. Ray Lambert, for access to the UK CIS-2 data which is examined in this paper. I am also grateful to Rod Coombs and two anonymous referees for comments on previous versions. Responsibility for the interpretation of the data, and any remaining errors, is solely mine.
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