Complementarities in the innovation strategydo intangibles play a role in enhancing the impact of R&D on firm performance?

Abstract

The objective of this paper is to assess the role of investments in advertising and human capital as a way to improve and to appropriate the returns to research and development (R&D). We evaluate firm performance focusing on the three intangible resources that the literature has argued as having the greatest strategic importance (technological, marketing resources and human capital) and develop hypotheses linking them with firm value creation. In order to test our hypotheses, we rely on a large sample of Spanish manufacturing firms. Our results show evidence of complementarities between technological and marketing resources, but they are not conclusive in the case of technological and human resources. Interestingly, the results are consistent with the idea that improvements in performance exist when the firms invest in the three assets at the same time.