Analysis of absorptive capacity and foreign direct investment in the productivity of Brazilian municipalities

Abstract

This is an Open Access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. 1. Introduction Absorptive Capacity (AC) is one of the most influential concepts in management literature. First introduced by Cohen & Levinthal (1989) and then developed by Zahra & George (2002) when it comes to learning and innovation on a company, and currently is a key word for a variety of strategies, routines and learning processes that influence the company's ability to exploit the external knowledge needed to build other organizational capacities (Todorova & Durisin, 2007; Zahra & George, 2002). The diffusion and acquisition of knowledge determine companies' potential for innovation (Griliches, 1998). However, Absorptive Capacity is necessary to understand and transform external knowledge flows, essential to achieve innovation and growth of companies (Cohen & Levinthal, 1990). It is noteworthy that the focus of many studies is about organizational factors that facilitate or inhibit the transfer process, including the organization's Absorptive Capacity (Gonzales & Martins, 2015).

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