The ability of firms to develop new technological knowledge is considered essential for firms’ long-term performance. This study addresses the evolving technological capabilities of all large... Show moreThe ability of firms to develop new technological knowledge is considered essential for firms’ long-term performance. This study addresses the evolving technological capabilities of all large multinational firms in order to understand patterns of increasing complexity of the knowledge base of firms. We first establish how the composition of the global patent portfolio of the world's top 2000 R&D performing companies. In general, the entry of technologies of firms can be explained by their relatedness to the existing technological portfolio. Related technologies are more likely to enter the portfolio of a firm than unrelated technologies. We find indications that technological progress of the global knowledge base is slowing as indicated by a relative increase in incremental recombinant innovation. Furthermore, we observe that the knowledge base of firms is characterized by increasing complexity and diversity. However, differences among firms and sectors are pronounced. New public policy lessons can be articulated. Show less
