Table 1 also shows the result of the correlation between independent variables and firm innovation. The result shows that our dependent variable, firm innovation, has a positive relationship with firm size, previous innovation performance, absorptive capacity, and autonomous R&D climate. A number of constructs might have inter correlations
with each other. Myers (1990) and Bowerman and O'Connell (1990) suggest that if the largest variance inflation factor
(VIF) is greater than 10 and then the concerns of multi-collinearity problem in the regression model may arise. Tests for multi collinearity among independent variables show that little multi collinearity exists among the independent variables in our study since the VIF is less than 2.