Co‐innovation behavior and sustainable innovation in competitive environments

Abstract Despite substantial efforts in examining the drivers of sustainable innovation, we still do not know enough about the impact of co‐innovation behavior. In this study, we investigated the effect of co‐innovation behavior on sustainable innovation and the combinative effect of absorptive capacity and competitive intensity on this relationship. Data collected from 312 firms revealed that a firm's level of co‐innovation behaviors is positively associated with sustainable innovation. Moreover, we find that the effect of co‐innovation behaviors on sustainable innovation is amplified when absorptive capacity is high. Finally, the moderating effect of absorptive capacity is exacerbated by competitive intensity. These findings contribute to the co‐innovation and sustainable innovation literature. The theoretical and practical implications are discussed.