Does geographic distance to partners affect firm R&D spending? The moderating roles of individuals, firms, and countries

Abstract

This paper examines the extent to which modern technology has impacted firms' R&D spending levels by empirically examining the relationship between inventor distance and R&D intensity at firm level. We find that inventor distance has a positive link with R&D intensity. Furthermore, we argue that the success of a collaboration network lies in the distinctive roles of the individuals, organizations, or countries involved. To test this theory, we extend the study to explore the moderating effects of the number of individuals, organizations, and countries participated in a collaborated invention. Using a combined data set of R&D financial and patent data from 531 highly innovative and R&D intensive firms, and several estimation techniques such as Probit predictive margins and the generalized method of moments (GMM), our findings show that distance-R&D intensity relationship can be influenced by the number of individual inventors, number of organizations, or countries involved in the collaborations.