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Impact of Open Innovation on Industries and Firms – A Dynamic Complex Systems View

Sengupta, Abhijit, Sena, Vania (2020) Impact of Open Innovation on Industries and Firms – A Dynamic Complex Systems View. Technological Forecasting and Social Change, 159 . Article Number 120199. ISSN 0040-1625. (doi:10.1016/j.techfore.2020.120199) (Access to this publication is currently restricted. You may be able to access a copy if URLs are provided) (KAR id:82053)

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https://doi.org/10.1016/j.techfore.2020.120199

Abstract

This paper develops novel behavioural models of open innovation (OI) for competitive markets and uses them to compare the impact of two types of OI frameworks – open source (OS) and patent-licensing (PL). The dynamic consequences of OI, for both OS and PL, are studied using a complex adaptive systems approach. We examine how profits, technology levels, R&D investment, technology adoption and market structure evolve under each and are impacted by underlying market characteristics. While both OS and PL are found to be equivalent in technology outcomes, OS comes with additional advantages to participating firms. Firms in the OS framework earn higher profit and are more efficient with their R&D investments. The industry is less concentrated under OS than under PL, except when market size is very large. In both frameworks, consumer preference for new product adoption has a significant impact. When consumers adopt newly introduced products relatively quickly, market concentration is the higher and overall rate of technological progress slower. These results contribute towards a deeper theoretical understanding of OI, opening new avenues for future research.

Item Type: Article
DOI/Identification number: 10.1016/j.techfore.2020.120199
Uncontrolled keywords: open innovation, open source, patent licensing, complexity, agent based model
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HB Economic Theory
H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Divisions: Divisions > Kent Business School > Kent Business School
Depositing User: Abhijit Sengupta
Date Deposited: 09 Jul 2020 13:51 UTC
Last Modified: 12 Mar 2021 11:27 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/82053 (The current URI for this page, for reference purposes)
Sengupta, Abhijit: https://orcid.org/0000-0002-2450-0208
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