External Knowledge Sourcing and Firm Innovation: Essays on the Micro-Foundations of Firms’ Search for Innovation

Innovation is at the heart of firm competitiveness. Due to the limited potential for knowledge recombination within organizational boundaries, companies are increasingly forced to span boundaries and tap into external knowledge sources in order to innovate. The role that skilled individuals play in this process of harnessing external knowledge for firm innovation is an increasingly studied phenomenon. However, the conditions under which external knowledge sourcing impacts firm innovation remain underexplored. The research question that guides this dissertation is formulated as follows: How does external knowledge sourcing affect firm-level innovative activity? The purpose of this thesis is to examine how recruitment of skilled individuals, and to a lesser extent collaboration and licensing, affects firm-level innovation, and which individual- and firm-level characteristics moderate this relationship. The dissertation consists of four empirical essays, an introduction, and a conclusion. The basis for three of these essays is The Integrated Database for Labor Market Research (IDA) provided by Statistics Denmark which is matched to patent data from the European Patent Office (EPO) and survey data on firm innovation from the Danish Centre for Studies in Research and Research Policy (CFA). One essay relies on a combination of the Deloitte Recap Database and patent data from the United States Patent and Trademark Office (USPTO). The combination of datasets used in each essay allows us to study the role of scientists and engineers and in particular their movement across organizational boundaries in great detail.