Abstract:
This study investigates the role of intra-cluster ties, extra-cluster ties,
and entrepreneurial orientation in shaping firms’ innovative performance. We
conduct our analysis on a primary data set of 120 small and medium enterprises
located in the Cibaduyut footwear-manufacturing cluster, Indonesia. We
explore the effectiveness of knowledge acquisition through intra-cluster ties and
extra-cluster ties on innovative performance. We find that extra-cluster ties
mediate the relationship between proactiveness and innovative performance.
Also, a combination of high extra-cluster ties and risk taking exert a positive
impact on innovative performance. Surprisingly, we find that risk taking negatively
moderates the influence of intra-cluster ties on innovative performance.
Over-reliance on within-cluster knowledge sharing may result in the diffusion
of redundant knowledge rather than making new knowledge available to the
firm. Overall, our findings point to the synergistic effects of entrepreneurial
orientation and extra-cluster ties on innovative performance.
