Absorptive Capacity for R&D: The Identification of Different Firm Profiles

Abstract

Being competitive requires continuously performing product and process innovations nowadays. Because of this reason, the absorption of externally generated R&D is increasingly important for companies. It is well known that companies differ regarding their aptitude for knowledge absorption. This paper aims at the identification of different firm profiles by means of the identification and valuation of drivers that support the absorption of external R&D. For this, we have carried out an empirical work that is based on a random sample of companies located in the northern Spanish county of Biscay. We identify four company conglomerates according to their attitude to absorb externally generated R&D.

Acknowledgements

Thanks are due to two anonymous referees who made very useful comments on earlier versions of this article. Financial support from the County Council of Biscay (research projects 12/63/2003/8/1 and 12/63/2004/38/1) and the Emilio Soldevilla Foundation is also gratefully acknowledged.

Notes

We selected these variables for two reasons: first because of the availability of data. Secondly, because these variables express synthetically the firm's resources and capacities: the number of employees reflects the dimension of the human factor; the sales level reflects not only the firm's size in terms of flows but also constitutes an indicator for the firm's capacity of market penetration; finally, the technological level indicates the disposability of high-levelled resources for innovation.

It is important to mention that the Spanish “Sociedad Anónima (SA)” is not totally identical to the Anglo-Saxon Public Limited Company (Plc) and the Spanish “Sociedad Limitada (SL)” is not totally the same as the Limited Liability Company (Ltd). Nevertheless, they have the same reason to be and correspond to the same tendencies regarding to their size.