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Absorptive capacity dimensions and the measurement of cumulativeness

Abstract:

Absorptive capacity (AC) has the potential to explain performance and competitive advantage. The cumulativeness feature of AC has been broadly covered in theory but remains underdeveloped in empirical assessments. This paper aims to revisit the relationships between AC and its knowledge dimensions and to contribute to measurement theory on AC. We adopt an existing survey instrument and confirm through structural equation modelling that the relationships between AC and its knowledge dimensions are better represented by a formative model, as opposed to the more used reflective model. Based on a simplex model and the Mokken scale, we also confirm that AC is an ability, developed cumulatively through a sequence of knowledge processes. The paper contributes to construct convergence by developing and illustrating guidelines for measurement that are congruent with the seminal definitions of AC but are underrepresented in the literature. It contributes to practice by highlighting the roadmap for developing AC.