Origins, Definitions, and Operationalizations
Even though Kedia and Bhagat (1988) were first to coin the term absorptive capacity, in the context of technology transfer across nations, Cohen and Levinthal (1989, 1990) are generally credited for forwarding the construct. The absorptive capacity construct evolved from research instigated in the 1970s and running through the 1980s on the role of internal research and development. Studies observed that internal research and development has a dual role. It not only shapes a firm’s technological innovation, but also allows firms to keep abreast of technological developments and assimilate new technology (Tilton, 1971). Consistent with studies using an Industrial Organization-based perspective to explain firm strategy, Cohen and Levinthal (1989, 1990) sought to provide a set of explanations for the dual role of research and development from that perspective. While their 1989 paper focused on firms’ incentives to learn and to invest in research and development as environmental opportunities vary from an economics perspective, their 1990 paper centered on the role of cognitive structures and took a more socio-economical approach. Borrowing from research on cognition and memory development (Ellis, 1965), in the latter paper they argue that individuals learn more efficiently when the knowledge to be learned is related to what is already known and emphasize the cumulative nature of learning.
As our understanding of the construct ...