Complementarity between innovation activities and innovation performance Evidence from Spanish innovative firms

Purpose - The purpose of this paper is to analyze the existence of complementarity between innovation activities (internal innovation, external innovation and cooperative R&D), as well as their impact on firms' innovation performance. Design/methodology/approach - Drawing on the Third Community Innovation Survey (CIS-3) for Spain, a multiple regression model is used to study the existence of complementarity between innovation activities and their impact on innovation performance. The sample for the study is 3,964 innovative firms. Findings - First of all, the empirical results propose that the complementarity appears only between internal innovation and either external or cooperative innovation - but not with both together, which is in-line with the "absorption capacity"notion. Second, the use of external and cooperation innovation in isolation does not yield positive effects on innovation performance. This finding contradicts the substitution argument and supports the absorptive capacity argument. Finally, innovation strategies do not seem to be dissimilar between industries. Research limitations/implications - The main limitation of the paper is the use of cross-section data, which implies less robust results as an empirical test. Practical implications - The empirical results allow the authors to recommend company managers and public administration officials to improve and support internal innovation. These activities should be combined with the high levels of external acquisitions that Spanish firms have in order to increase their innovation performance as the absorption capacity theory and this paper's empirical results suggest. Originality/value - The first contribution of the paper is the inclusion of the third form of innovation: cooperation. The second contribution refers to the inclusion of the service sector in the authors' sample.