Exploring and Exploiting Through External Sources: The Effect of Learning and Technological Proximity

Abstract

In this paper, we investigate how the different types of external learning performed by organisations, i.e., interaction and imitation, and their technological proximity with external sources affect exploration and exploitation. Specifically, analysing the last 250 patents registered by Toyota Motor Corp. at the European Patent Office, we find that exploration is favoured by interactive learning mechanisms and technological diversity between knowledge source and recipient. On the contrary, learning by interaction and similarity between technological competencies and capabilities are more suitable for exploitative research activities.

Keywords: innovation, learning, exploration, exploitation, external learning, technological proximity

JEL Classification: D83, O31, O32