The paper investigates innovative collaboration undertaken by newly
established foreign invested R&D units in emerging markets. In particular, the
paper investigates how foreign invested newly established R&D centers in
emerging markets can leverage local knowledge networks, such as universities,
in order to increase innovation performance. The theoretical framework is
based on theories on trust, as well as institutional theory. The findings suggest
that cognition-based trust as well as affect-based trust is needed for successful
innovative collaboration, however, in emerging markets affect-based trust is
more important than Westerners are used to. This is due to the different
institutional backgrounds, in emerging markets and developed markets
respectively.