AbstractThis paper addresses a number of issues surrounding the emergence, durability and importance of one form of strategic partnering activity — inter-firm co-operative agreements in research and development. These partnerships are distinguished from more traditional forms of joint venture and licensing arrangements by three main characteristics: a focus on knowledge production and sharing as opposed to a one-way transfer of technology — where knowledge is understood to include research and development, as well as design, engineering, marketing and management capabilities; their contractual nature with frequently little or no equity involvement by the participants; and a tendency to enter into such partnerships as part of the longer term planning activity of the firm rather than as an opportunistic response to short-term financial gain.