Technological learning and the accumulation of innovation capabilities: evidence from contract manufacturers in Brazil

Abstract

Despite the profusion of studies on learning as a means of building technological competence in firms, most have examined this relationship from an intra-firm perspective. This article examines the role of cross-firm knowledge flows to build production capacity and innovation in the subsidiaries of multinationals in the sector of information technology and communication (ITC) in Brazil, from 1996 to 2007. Based on first-hand evidence obtained in fieldwork, the study found that, for the last ten years, the companies surveyed have actively engaged in accumulating technological capabilities. However, the study also identified a high degree of variability across companies in terms of the depth of their technological capability accumulation. A substantial part of this variability can be explained by the role of crossorganizational learning processes. This article, therefore, helps to further our understanding of the process of technological accumulation in subsidiaries of multinationals in emerging economies. The study also contradicts common generalizations, according to which this kind of company plays a passive role in emerging economies when it comes to technological activities.