Patterns of knowledge flows and MNE innovative performance

This paper examines the influence of inter-and intra organisational knowledge flows on innovative performance in multinational enterprises. It employs a theoretical framework relating to organisational differentiation within multinational enterprises to generate a number of hypotheses linking knowledge flows to innovate performance. The hypotheses are tested in the biopharmaceutical context. Patent citations and co-patenting are utilised to capture knowledge flows. The findings support suggestion in the literature that subsidiary embededdness in external knowledge stimulates innovation in MNEs. © 2004 Elsevier Inc. All rights reserved