Once Bitten, Less Shy? – The Impact of Legal Copying and Illegal Infringement on R&D Cooperation

Abstract

In this article, we investigate whether a company’s experience with legal copying of its non-protected intellectual property (IP) and, contrasting, illegal infringement of its intellectual property rights (IPR) influences its decision to cooperate on R&D. We base our arguments on literature focusing on learning from failure and rare events and empirically test our hypotheses using data of the German Community Innovation Survey. We find that firms with experience regarding the legal copying of their IP are less willing to engage in research collaboration, while in contrast, firms with experience regarding the illegal infringement of their IPR are more likely to cooperate on R&D. Our results provide humble contributions to the organizational learning literature in pointing out that failure events of firm strategies can trigger learning processes. Further, we inform strategic management literature in shedding light on the complex interdependencies of IP, appropriation and firms‘ innovation strategies. Innovation management literature benefits from this study as it provides insight into the connection between legal copying, illegal infringement and R&D cooperation, thus, offering two new determinants of firms’ R&D cooperation behavior.