Abstract: With the fierce competence and rapid development of globalization, the ability of innovation has been the important way to acquire competitive advantages for firms. Firms can share and interact knowledge to foster innovation through research collaboration among firms. More precisely, firms can acquire similar knowledge because of geographical proximity which will help firms increase the quantity of innovation; while they also will obtain diverse knowledge by collaborating with non-local partners which can be good for the quality of innovation. Then, in the context of resource limitation, how firms should deal with the relationship between local collaboration and non-local collaboration to maximize their innovation is a key for promotion of competition ability. From the perspective of organizational ambidexterity, local andnon-local collaboration have become an important way to realize innovation of exploitation and exploration. There have been lots of studies on research collaboration, but how firms deal with the relationship between local and non-local collaboration has not been well answered. Firstly, it has been generally agreed that both local and non-local collaboration are conducive to innovation of firms. However, which kind of relationship is more beneficial to firms, balance, complementation, or both? Secondly, are there other factors which can exert an effect on the relationship between collaboration and innovation besides the absorptive capacity and technological diversity? Therefore, according to the perspective of knowledge search and organizational ambidexterity, this paper develops and tests theoretical hypotheses on the balance and complementation between local and non-local research collaboration and its impacts on innovation, as well as the moderating effect of firm size through using negative binomial regression models with a longitudinal panel dataset involving listed firms in electric vehicle industry. This paper defined and explained the relevant concepts about collaboration at first. The complementation between local andnon-local collaboration refers to the complementary relationship between two kinds of collaborative behaviors, that is, not only the pursuit of single collaborative behavior, but through the mutual promotion of two collaborative behaviors to promote the innovation output of firms. And the balance of local and non-local collaboration refers to the behavior of pursuing local and non-local collaboration and requiring two kinds of knowledge at the same time. It focuses on the trade-off to find the most appropriate balance between the two. Besides, firm size is strongly indicative of the resources it possesses at its immediate disposal. This paper mainly focused on how firm size moderates the relationship between the balance and complementation of local and non-local collaboration and firms’ innovation.Then this paper proposed the following hypotheses: H1a: The complementary relationship between local andnon-local collaboration is positively related to innovation of a focal firm. H1b: The balance between local and non-local collaboration is negatively related to the innovation of a focal firm. H1c: High levels of both balance and complementation synergistically lead to better innovation of a focal firm. H2a: The focal firm’s size moderates the relationship between the complementation of local and non-local collaboration and a focal firm’s innovation negatively. H2b: The focal firm’s size moderates the relationship between the balance of local and non-local collaboration and a focal firm’s innovation negatively. To test these theoretical hypotheses, this paper has taken 176 listed companies in electric vehicle industry as samples, studying the relationship between local andnon-local collaboration and innovation of firms. The patent data are from U.S. Patent and Trademark Office (USPTO) and Japan and Europe invention patents from Innojoy, and the financial data including R&D expenditure, net turnover, total assets and other indicators were obtained through the Compustat database and the official corporate websites. As it is difficult to obtain data of some listed firms for ten consecutive years, there are a number of missing observations. Therefore, non-equilibrium panel data regression model is adopted in the paper. Since the dependent variables are discrete non-negative integers, the counting model is used. As the variance is much larger than the mean in these two models, the negative binomial regression model is used to test the hypotheses.Focusing on firm collaborative behavior, this article has unpacked how two kinds of different dimensions of collaboration between firms: collaboration balance and collaboration complementation affect innovation of the focal firm from the perspective of knowledge search. In addition, the study also proposed the joint effect of collaboration balance and collaboration complementation and the moderating effect of firm size, making the following theoretical contributions and practical implications.Firstly, our results document a positive relationship between the complementation of local collaboration andnon-local collaboration and innovation of the focal firm, while the balance of local collaboration and non-local collaboration exerts a negative influence on firm’ innovation. And there is a jointly positive effect between collaboration balance and complementation on innovation. In addition, local collaboration and non-local collaboration of firms both affect innovation positively and significantly, which are consistent with the existing conclusion. Specifically, local and non-local collaboration can complement each other and achieve complementary effects, which are conducive to the innovation of firms. Meanwhile, the study also finds that the collaboration balance and collaboration complementation can generate synergistic effect, which will foster innovation. Therefore, firms should pursue not only local collaboration but also non-local collaboration, but don’t need to achieve absolute balance between them. It is important for the managers in resource-constrained contexts to be aware that an effective innovation strategy need to be combined with firm’s own knowledge base and absorption ability.Secondly, the scale of firm plays different roles in the relationship between collaboration and innovation. To large firms that possess lots of resources, the complementary effect of local collaboration andnon-local collaboration has a decreasing scale effect, which is not conducive to increasing innovation. However, the balance between local collaboration and non-local collaboration won’t be limited by resources. Small firms, with fewer resources, present the opposite result to large firms. Therefore, small firms need to attach importance to the complementation of local and non-local collaboration and mainly rely on one of them to foster innovation. Large firms need to give full play to the collaboration balance effect and realize the synergistic effect between balance and complementation.

Key words:  innovation, local and non-local research collaboration, balance, complementation