The economics of knowledge regulation: an empirical analysis of knowledge flows

Abstract

Successful innovation depends on the management of a firm's knowledge base. This paper empirically investigates the determinants of knowledge regulation. Using a unique survey dataset, the analysis suggests that research and development managers do not leak knowledge randomly, but rather regulate knowledge consciously. I find that the source and the channel of knowledge inflows impact knowledge regulation. The findings reveal that the more a firm profits from knowledge inflows from competitors, the fewer actions it takes to regulate outgoing knowledge. I do not find that the extent of knowledge inflows from collaborating firms impacts knowledge regulation. However, the type of channel being used to acquire knowledge matters. Compared with public channels, the different types of private channels used to access knowledge inflow and the type of the competitive relationship influence the firms' decision to regulate knowledge outflow in the following way: concerning relationships with competitors, firms regulate knowledge outflow more when using formal channels, but less when using informal channels; concerning collaborative relationships, firms regulate knowledge outflow less regardless of whether they are using formal or informal private channels compared with using public channels. Presumably, firms that acquire knowledge from competing firms through formal private channels try to establish opaque and soundproof fences to surround them, whereas firms that acquire knowledge from collaborating firms through formal or informal private channels do not want to restrict circulation, but rather facilitate inter‐firm knowledge exchange.

Absorbing partner knowledge in R&D collaborations – the influence of founders on potential and realized absorptive capacity

“…Founders are therefore well placed to facilitate acquisition and assimilation of new knowledge. As such they are in a favourable position to facilitate regulation of internal and external knowledge flows (Kogut and Zander, ; Haeussler, ) and support assimilation of new knowledge in a partner project.…”

The effects of knowledge interaction for business innovation

“…(2) What kind of business innovations can be achieved? On the topic of knowledge for innovation, studies in economics (Romer, ; Haussler, ) and strategic management (Leiponen and Helfat, ; Zhou and Li, ) tend to describe knowledge at generalized level as resources or information. However, knowledge in an organizational setting requires deeper scrutiny about content and context (Ahlstrom and Nair, ; Wang et al., ).…”

Absorbing Partner Knowledge in R&D Collaborations – The Influence of Founders on Absorptive Capacity

“…In this case, some individual or individuals may take on a 'gatekeeper' role, translating the external information 'into a form understandable to the group' (Cohen and Levinthal, 1990, p. 132). As such they are in a favourable position to facilitate regulation of internal and external knowledge flows (Kogut and Zander, 1992;Haeussler, 2010) and support assimilation of new knowledge in a partner project. This makes the founder familiar with the knowledge base of the firm and well able to judge what form the internal firm actors will best understand.…”