Collaborating to be innovative: a critical look at factors attracting firms to their cooperating partners

Abstract

The intense market competition firms find themselves in means that they need to be innovative to survive. Firms have realized that they can stimulate the transfer of technology by fostering closer partnerships with other firms in the enterprise group, and with research institutions such as universities and other public research institutions. This innovative collaboration enables enterprises to gain access to innovation, technology and knowledge that they cannot produce in isolation. The focus of this paper is to examine the factors that informs firms choice of collaborating partners. We used data from the community innovation survey 2010-2012, and the probit regression model for our empirical analysis. Our results have demonstrated that the size of firms, innovation barriers and firm’s strategies on collaboration influence their collaboration decision. Firm size for instance influenced their collaboration with competitors and institutions such as universities and public research institutions. Firm’s innovation strategies also influenced their collaboration with market competitors. Our finding contributes to the theoretical debate on innovation and technology transfer. The results of the analysis confirm the importance of involving the public sector in cooperative chains aimed at producing innovations.