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The purpose of this paper is to analyse cooperation in R&D in the automobile industry in Spain. It first examines to what extent firms cooperate with external actors in the field of technological innovation, and if so, with what type of cooperation partner, paying special attention to the differentiation according to the size of the firms. Second, it aims to study how the firm’s size may affect not only the decision of cooperating but also with which type of partner.

The data in this study came from the surveys done in 2010 and 2013 by the Technological Innovation Panel (PITEC) for firms in the automotive industry. The paper estimates a bivariate probit model that takes into account the two types of cooperation mostly present in such an industry, vertical and institutional, explicitly considering the interdependencies that may arise in their simultaneous choice.

The empirical study confirms that small firms cooperate less frequently than big firms and that giving more importance to information publicly available and having public financial support from local and national governments are important determinants of collaboration agreements, mainly in the case of customers and suppliers.

This paper contributes to the understanding of the motivations of the automotive industry for engaging in R&D cooperation agreements. The authors study how the firm’s size may affect not only the decision of cooperating but also with which type of partner.