The thesis analyzes firm level absorptive capacity in a developing country, Thailand. The theoretical framework applied draws upon evolutionary economics, and more particularly the concepts of technological capability and absorptive capacity. Quantitative material is provided by the World Bank Enterprise Surveys. The project uses the method of factor analysis to explore variables related to the concept of absorptive capacity in the scholarly literature, in order to identify the empirical evidence of the concept. The resulting outcome clearly demonstrates several separate, while interconnected, aspects of absorptive capacity in the case of Thailand.