Non-technological strategic alliances and public support for innovation: What are, if any, their links?

This paper studies the impact of public support for innovation on the firm’s decision to establish non-technological strategic alliances. These alliances are crucial for firm efficiency and growth as they provide access to new markets, distribution channels, and expertise. We provide a theoretical discussion of the potential mechanisms at play (absorptive capacity and certification effect) and test them using Uruguayan data spanning the years 2007 to 2015. Our empirical findings present evidence of a positive causal effect of public support for innovation and a firm’s propensity to engage in non-technological strategic alliances. Additionally, we show that the absorptive capacity mechanism drives the effect while we find no evidence supporting the certification effect.