Associate Professor of Strategy
Knowledge integration;Multinational firms;Collaboration;Mobility ;
Journal Article | Research Policy | 37 | February 2008
Distributed R&D, Cross-Regional Knowledge Integration and Quality of Innovative Output
This paper studies the impact of geographic dispersion of a firm's R&D activities on the quality of its innovative output. Theoretically, the sign of this relationship is ambiguous since gains from access to expertise and resources from different regions could be offset by costs of coordination and difficulty of knowledge integration across distant units.Empirically, the author finds no evidence that distributed R&D in itself improves the value of a firm's innovations. In fact, if anything, innovations from firms with distributed R&D have a slightly lower average value than those from firms with more centralized R&D.However, when geographic dispersion of R&D is also accompanied by a sufficient extent of cross-regional ties across researchers from different R&D units, the author finds that the above effect gets reversed and an improvement in innovation does occur.More generally, these findings provide new evidence regarding the importance of intra-firm networks for the performance of multi-unit firms.