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In this paper we use a panel of manufacturing firms in Spain to examine the extent to which they use internal and external sources of information (customers, suppliers, competitors, consultants and universities) to generate product and process innovation. Our results show that, although internal sources are influential, external sources of information are key to achieve innovation performance. These results are in line with the open innovation literature because they show that firms that are opening up their innovation process and that use different information sources have a greater capacity to generate innovations. We also find that the importance of external sources of information varies depending on the type of innovation (product or process) considered. To generate process innovation, firms mainly rely on suppliers while, to generate product innovation, the main contribution is from customers. The potential simultaneity between product and process innovation is also taken into consideration. We find that the generation of both types of innovation is not independent. [ABSTRACT FROM AUTHOR]

The study of firms' decisions on open innovation has recently attracted the attention of scholars studying the process that firms follow from closed to open models. Extant research has acknowledged that firms tend toward open innovation models and has identified the optimum levels of breadth and depth of openness toward which firms should tend. Surprisingly, there is little evidence on how firms move toward open innovation and whether they follow scholars' recommendations. In this paper, we investigate the adoption of the open innovation model, studying firms' decisions on breadth and depth and switching behaviours over time. This paper provides a discussion of firms' degree of openness and how firms structure and reassess their decisions on open innovation over time. This framework was applied to the Panel of Technological Innovation database that includes data on Spanish innovating firms for the period 2005–2013. [ABSTRACT FROM AUTHOR]