Why are Companies Offshoring Innovation? The Emerging Global Race for Talent

25 Pages Posted: 13 Apr 2011  

Arie Y. Lewin

Duke University - Fuqua School of Business

Silvia Massini

University of Manchester

Carine Peeters

Université Libre de Bruxelles (ULB) - Solvay Brussels School of Economics and Management

Date Written: August 2009

Abstract

This paper empirically studies determinants of decision by companies to offshore innovation activities. It uses survey data from the international Offshoring Research Network project to estimate the impact of managerial intentionality, past experience, and environmental factors on the probability of offshoring innovation projects. The results show that the emerging shortage of highly skilled science and engineering talent in the US and, more generally, the need to access qualified personnel are important explanatory factors for offshoring innovation decisions. Moreover, contrary to drivers of many other functions, labor arbitrage is less important than other forms of cost savings. The paper concludes with a discussion of the changing dynamics underlying offshoring of innovation activities, suggesting that companies are entering a global race for talent.

Suggested Citation

Lewin, Arie Y. and Massini, Silvia and Peeters, Carine, Why are Companies Offshoring Innovation? The Emerging Global Race for Talent (August 2009). Journal of International Business Studies, Vol. 40, Issue 6, pp. 901-925, 2009. Available at SSRN: https://ssrn.com/abstract=1808508 or http://dx.doi.org/10.1057/jibs.2008.92

Arie Y. Lewin (Contact Author)

Duke University - Fuqua School of Business ( email )

Box 90120
Durham, NC 27708-0120
United States
919-660-7832 (Phone)
919-681-6244 (Fax)

HOME PAGE: http://www.fuqua.duke.edu/faculty/alpha/ayl3.htm

Silvia Massini

University of Manchester ( email )

Oxford Road
Manchester, M13 9PL
United Kingdom

Carine Peeters

Université Libre de Bruxelles (ULB) - Solvay Brussels School of Economics and Management ( email )

19 Av Franklin Roosevelt
1050
Brussels
Belgium

Paper statistics

Downloads
2
Abstract Views
433