Innovation and the geographical and functional dimensions of outsourcing: An empirical investigation based on Italian firm level data

Lucia Cusmano, Maria Luisa Mancasi () and Andrea Morrison
Authors registered in the RePEc Author Service: Maria Luisa Mancusi

No 806, Papers in Evolutionary Economic Geography (PEEG) from Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography

Abstract: The paper investigates the diversified patterns of outsourcing in the Lombardy region and relates them to the probability of introducing product and process innovation. Based on a large firm-level survey, we show that outsourcing processes are strongly regionally embedded and that offshoring is still a limited phenomenon. Outsourcing strategies are shown to have a positive impact on firms’ innovation. In particular, the outsourcing of service activities contributes the most to innovation, thus suggesting that firms successfully pursue core strengthening strategies. Our econometric estimates show that both geographical and organizational proximity matter. Indeed, the positive association of services with innovation is strongly related to their regional dimension, which points toward the importance of local user-producer relationships. When outsourcing crosses national borders, keeping the outsourced activities at least loosely connected to the firm appears critical, as offshoring to non affiliated firms has a clear negative impact on innovation.

Keywords: Product Innovation; Process Innovation; Outsourcing; Offshoring (search for similar items in EconPapers)
JEL-codes: D21 F23 L22 L23 O31 O32 O33 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2008-03, Revised 2008-04
New Economics Papers: this item is included in nep-cse, nep-geo, nep-ino and nep-tid
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://econ.geo.uu.nl/peeg/peeg0806.pdf Version April 2008 (application/pdf)

Related works:
Working Paper: Innovation and the geographical and functional dimensions of outsourcing: An empirical investigation based on Italian firm level data (2007)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:egu:wpaper:0806

Access Statistics for this paper

More papers in Papers in Evolutionary Economic Geography (PEEG) from Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography Contact information at EDIRC.
Bibliographic data for series maintained by ( this e-mail address is bad, please contact ).