Why are companies offshoring innovation the emerging global race for talent
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. © 2009 Academy of International Business All rights reserved.
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Citation
Published In
DOI
EISSN
ISSN
Publication Date
Volume
Issue
Start / End Page
Related Subject Headings
- Business & Management
- 3507 Strategy, management and organisational behaviour
- 3505 Human resources and industrial relations
- 3502 Banking, finance and investment
- 1505 Marketing
- 1503 Business and Management
- 1402 Applied Economics