Weak and strong ties, individualism-collectivism, and the diffusion of technological knowledge

Abstract

Despite the importance of gathering technological knowledge from external sources, many firms are not well-placed to collect information from beyond their own boundaries. Government policies designed to improve access to technological knowledge often encourage firms to develop strong ties with competitors, suppliers or customers. But although strong ties are valuable, especially when tacit knowledge needs to be communicated, firms in individualistic cultures may resist entering into close relationships with other firms. As a result, policies that encourage such firms to form weak ties may be a more effective way of promoting the spread of technological knowledge in individualistic cultures. In this paper, we develop a set of propositions concerning the suitability of strong and weak ties in cultures that are relatively more individualistic or collectivist. Our arguments are illustrated with survey data from Australia and Finland. In the final section, we make some policy recommendations for improving the diffusion of technological knowledge among firms in individualist cultures.