Open sourcing, labour productivity, and the moderating role of R&D

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Abstract
Firms are more likely to adopt open-sourcing strategies when they operate in environments dense with other innovative firms, allowing reciprocal learning and knowledge exchange.Building on the literature linking sectoral openness to productivity growth, we examine whether firms’ propensity to publish scientific work amplifies the productivity returns to R&D investment.We find that adopting an open-sourcing strategy is positively associated with labour productivity among R&D-intensive firms, controlling for unobserved heterogeneity at the firm and sector level.This result is consistent with theories emphasizing both the direct effects of R&D on innovation output and its indirect effects through knowledge diffusion and absorptive capacity. Methodologically, the paper extends Hausman–Taylor-type approaches for the identification of time-invariant variables in a fixed effect framework. Monte Carlo simulations show that this approach reliably identifies the impact of these regressors on productivity.

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