From Contracts to Co-Creation: Navigating Institutional Voids and Innovation in Georgia's University–Industry Partnerships

Abstract

This study examines how university–industry (U–I) partnerships in Georgia navigate institutional voids by blending formal contracts with co-creation mechanisms to generate innovation outcomes.
Drawing on institutional theory, transaction cost economics, and open innovation perspectives, we test a conceptual model linking institutional voids, co-creation mechanisms, and innovation performance using original cross-sectional survey data from 44 firms actively engaged in U–I collaborations. Hierarchical regression and moderation analyses were employed to assess hypothesized relationships.
Co-creation mechanisms (joint research, internships, consortia, and mixed teams) show a positive, marginally significant association with knowledge outcomes, but do not directly translate into commercial outcomes. Institutional voids do not significantly deter co-creation; instead, firms rely on relational governance and trust-based coordination to sustain collaboration. Partnership maturity moderates the institutional voids–co-creation nexus, with longer-standing partnerships better able to leverage co-creation under weak formal institutions. A persistent knowledge–commercialization gap remains, underscoring the limits of relational substitutes in the absence of robust technology transfer infrastructures.
The study provides micro-level evidence from a post-Soviet transition economy, demonstrating that hybrid governance—sequencing from relational trust toward formalized structures as partnerships mature—offers the most viable pathway for innovation under institutional voids. It extends governance theory by showing that while co-creation effectively builds absorptive capacity, commercialization requires complementary institutional assets that remain scarce in emerging ecosystems.