| Abstract: | The ongoing globalization tears down geographical barriers to knowledge sourcing, leaving cultural ones intact. Past research on developing innovations has largely neglected national culture or solely relied on cultural values. A recent body of research has emerged around cultural looseness – the strength of social norms and the degree of sanctioning within societies – and provided initial evidence on its importance for mastering creativity, an antecedent of innovations. However, the impact of cultural looseness on developing innovations in networks with diverse actors has not yet been tested. To this end, we develop a Multiple Indicator Multiple Causes (MIMIC) structural equation model and test it against empirical evidence from >1.25 million patented innovations. We find that in innovation networks, innovators based in culturally loose countries source knowledge of higher breadth and depth for developing innovations compared to innovators from culturally tight countries. We discuss our findings and – based on some study limitations – suggest seven streams for future research. We conclude with summarizing our contribution to theory on the impact of culture on innovation and our contribution to practice on helping managers to decide how to best source knowledge and thereby foster innovation. |
