Endogenous competences and linkages development

In this paper we analyze empirically the influence of firms’ endogenous competences in the existence, quality and results of the linkages between firms and different types of agents. Using survey data from 170 firms belonging to the steel making and automotive production networks in Argentina, we show that the level of endogenous competences influences the linkages’ quality, objectives and results. Higher level of competences generates more virtuous linkages and influences the objectives that firms are after when interacting. Without certain minimum competences, firms only relate commercially and do not form links aimed to exchange knowledge or innovate. Better standing in terms of competences positively affects the probability of being involved in technological transfer agreements and cooperation agreements aimed at innovation. Being involved in useful interations requires previous competences, defining a vicious circle that calls for public intervention and policy implementation.