Inter-firm collaboration and innovation performance for new-to-market products: The moderating role of technological and skilled knowledge assets

This study examines the impact that the two types of knowledge assets – <i>technological knowledge</i> and <i>skills-related knowledge</i> – have on the link between inter-firm collaboration (IFC) and product innovation performance, measured by the sales share of new-to-market products. Drawing on Transaction Cost Economics, we propose that the relation specificity of these knowledge assets that a firm shares with its partners (reflecting its level of R&D and training investments respectively) is a key determinant of the benefits and transaction costs associated with IFC. Using a two-wave panel of 480 innovating firms in the Australian state of Tasmania, we find that the observed positive association between IFC and the sales share of new-to-market products declines at high levels of R&D and training intensities. Our findings help strengthen an understanding of the role of transaction costs for relation-specific knowledge assets and the factors that could influence the value of IFC as a pathway to enhanced innovation performance for new-to-market products.