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New Silicon Valleys or a New Species? Commoditization of Knowledge Work and the Rise of Knowledge Services Clusters

45 Pages Posted: 2 Feb 2011 Last revised: 3 Mar 2013

Stephan Manning

University of Massachusetts at Boston - College of Management

Date Written: February 28, 2013

Abstract

This paper explores knowledge services clusters (KSCs) as a distinct and increasingly important form of geographic cluster, in particular in emerging economies: KSCs are defined as geographic concentrations of lower-cost skills serving global demand for increasingly commoditized knowledge services. Based on prior research on clusters and services offshoring, and data from the Offshoring Research Network (ORN), major properties and contingencies of KSC growth are discussed and compared with both high-tech clusters and low-cost manufacturing clusters. Special emphasis is put on the ambivalent effect of commoditization of knowledge work on KSC growth: It is proposed that KSCs attract most projects if service commoditization is medium, whereas higher or lower commoditization either increases global competitive pressure or lowers demand and economies of scale and scope. KSC attractiveness is further related to the perceived availability of skills at relatively low costs, and cluster connectedness with client economies through corporate networks and professional communities. Findings not only advance current debates on clusters, global services sourcing, and the geography of knowledge production, but also have important policy implications.

Keywords: Knowledge Services, Geographic Clusters, Co-evolution, Outsourcing, Global Value Chains, Global Race for Talent, Global Service Delivery Model, Brain Circulation, Globalization of Innovation and R&D

JEL Classification: J23, J24, J44, J31, M51, M53, M54, L14, L21, L22, L24, L62, L84, O14, R11, P45, P48, F59, F21, F22

Suggested Citation

Manning, Stephan, New Silicon Valleys or a New Species? Commoditization of Knowledge Work and the Rise of Knowledge Services Clusters (February 28, 2013). Research Policy, Vol. 42, pp. 379-390, 2013. Available at SSRN: https://ssrn.com/abstract=1753188 or http://dx.doi.org/10.2139/ssrn.1753188

Stephan Manning (Contact Author)

University of Massachusetts at Boston - College of Management ( email )

100 Morrissey Blvd
Boston, MA 02125
United States

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