The interaction effect of absorptive capacity and partner types on product innovation in SMEs

ABSTRACTThis paper aims to examine the relationship between absorptive capacity (ACAP) of small and medium-sized enterprises (SMEs) and their external partner types for successful product innovation. There has been little empirical research regarding the synergy between SMEs’ internal capabilities and partner types in collaborative R&D projects. We developed and tested an integrated model from the knowledge- and resource-based views to explain the substantial disparities in payoff of collaborative R&D projects that exist between firms. Our study of 2,360 government-funded R&D projects in South Korea found that the direct effect of ACAP and interactions with science-based partners had a positive effect on product innovation success, whereas interactions with market-based partners had no significant effect. Our findings provide meaningful evidence for SMEs and policymakers who have to decide between R&D partners for their innovation strategy.KEYWORDS: Open innovation in SMEsabsorptive capacityexternal partner typeR&D project-level AcknowledgmentsThis work was supported by Korea Institute of Science and Technology Information under Grant [K-22-L03-C03-S01].Disclosure statementNo potential conflict of interest was reported by the authors.Additional informationFundingThe work was supported by the Korea Institute of Science and Technology Information [K-22-L03-C03-S01, K-23-L03-C03-S01].