“Sticky Information” and the Locus of Problem Solving: Implications for Innovation
Abstract The problem of ‘sticky’ information in the context of firms—the fact that information needed for technical problem solving tends to be costly to acquire, transfer, and put to use in a new location—is highlighted. When the requisite sticky information resides at only one location, problem solving tends to take place at that location. When more sites collectively serve as a repository of the demanded sticky information, problem solving is iterated between these sites or the problem will be broken down so as to simulate the first case. The final avenue is to make investments that reduce the stickiness, and thus the costs, of applying such information at other sites. The findings have significant implications for more general issues such as patterns in the diffusion of information, the specialization of firms and the locus of innovation.