This paper presents a systematic review of the literature linking firm networking behavior with innovative capacity. The review identifies several key benefits of networking, including risk sharing, access to new markets and technologies, speed to market, complementary skill pooling, property rights protection, and access to external knowledge. The evidence also highlights that firms that do not engage in knowledge exchange limit their long-term knowledge base and reduce their ability to enter into exchange relationships. At the institutional level, national systems of innovation play a crucial role in shaping networking activity and diffusion of innovations. The paper discusses the importance of network relationships with suppliers, customers, and intermediaries, such as professional and trade associations, in affecting innovation performance and productivity. It also identifies gaps in the literature, such as the need for further exploration of the relationship between networking and different forms of innovation, and the role of third parties like professional and trade associations. The review concludes by highlighting the need for interdisciplinary research and policy implications to foster business-to-business networking leading to greater innovative capacity.This paper presents a systematic review of the literature linking firm networking behavior with innovative capacity. The review identifies several key benefits of networking, including risk sharing, access to new markets and technologies, speed to market, complementary skill pooling, property rights protection, and access to external knowledge. The evidence also highlights that firms that do not engage in knowledge exchange limit their long-term knowledge base and reduce their ability to enter into exchange relationships. At the institutional level, national systems of innovation play a crucial role in shaping networking activity and diffusion of innovations. The paper discusses the importance of network relationships with suppliers, customers, and intermediaries, such as professional and trade associations, in affecting innovation performance and productivity. It also identifies gaps in the literature, such as the need for further exploration of the relationship between networking and different forms of innovation, and the role of third parties like professional and trade associations. The review concludes by highlighting the need for interdisciplinary research and policy implications to foster business-to-business networking leading to greater innovative capacity.