What drives the decision of SMEs to collaborate in R&D?

Academics and policy makers increasingly recognize the importance of collaborative R&D as one of the key mechanisms to produce innovation by accessing external resources, more efficient knowledge and technology transfer,... [ view full abstract ]

Academics and policy makers increasingly recognize the importance of collaborative R&D as one of the key mechanisms to produce innovation by accessing external resources, more efficient knowledge and technology transfer, shared capabilities, and organizational learning. Complexity, risk and cost of innovation as well as lack of expertise and knowhow may be considerable reasons for firms to undertake collaborations in R&D projects, especially SMEs. In this respect, the main purpose of this paper is to explore the determinants of R&D collaborations of SMEs by using a unique dataset derived from a survey of 3500 Greek SMEs. Six types of factors are examined for their potential role in the engagement of firms in R&D collaborations including competitive strategy (e.g. low-cost strategy; product differentiation strategy), internal organization (e.g. decentralization; commitment of managers on growth objectives; professional management), competitive pressure, human capital, absorptive capacity, and multinational activity of firms. Our empirical findings reveal that absorptive capacity, multinational operation and ICT skills of employees facilitate SMEs to establish and/or develop R&D collaborations increasing thus their likelihood to innovate. Policy and managerial implications of our findings highlight the need to stimulate SMEs’ internationalization, increase training of personnel in e-skills and facilitate adaptation to technological evolution.