Inter-Firm Coopetition, Firm Innovation Capability, and New Product Development Performance in Industrial Clusters

Despite the growing interest in the impact of coopetition (cooperation, constructive conflict, and destructive conflict) on innovation performance of firms in industrial clusters, its impact on new product development (NPD) performance and potential mechanisms remain unclear. This paper investigates whether and how inter-firm coopetition in industrial clusters affects NPD performance. Based on dynamic capability theory, this paper explores the mediating mechanisms of innovation capabilities (incremental and radical innovation capability) and tests the interactive effects of cooperation and two types of conflicts on innovation capabilities. The results of an empirical study of a sample of 181 industry cluster firms show that cooperation and constructive conflict positively affect both types of innovation capability, while destructive conflict only negatively affects incremental innovation capability. Furthermore, cooperation and constructive conflict have a negative interaction effect on radical innovation capability, while cooperation and destructive conflict have a positive interaction effect on incremental innovation capability. In addition, the results confirm the mediating role of innovation capabilities between cooperation, constructive conflict and NPD performance. These findings enrich the literature on coopetition and dynamic capability theory, extend the research context to industrial clusters, and provide suggestions for firm managers and government officials of industrial clusters