A quest in time: How the maturity, distance, and diffusion of knowledge affect innovation

Prior research has offered mixed views on the implications of knowledge maturity for the value of innovation. We seek to reconcile these views by claiming that the effect of knowledge maturity is contingent on the origin of knowledge and the extent of its diffusion in the industry. We predict an inverted U-shaped effect of knowledge maturity on the value of new innovations. Moreover, when inventors incorporate geographically distant knowledge in their innovations, we expect the value of knowledge maturity to be enhanced. In turn, incorporating technologically distant knowledge or waiting for knowledge to become diffused in the industry is likely to mitigate the value of knowledge maturity. Analysis of the citation patterns associated with 5,575 biotechnology patents of firms operating in the United States between 1985 and 2002 offers support for our conjectures. By underscoring the contingent value of knowledge maturity, our study advances innovation research and contributes to the learning literature.