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The Globalization of the Software Industry: Perspectives and Opportunities for Developed and Developing Countries

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Author Info
Asish Arora
Alfonso Gambardella

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Abstract

The spectacular growth of the software industry in some non-G7 economies has aroused both interest and concern. This paper addresses two sets of inter-related issues. First, we explore the determinants of these successful stories. We then touch upon the broader question of what lessons, if any, can be drawn from for economic development more generally. Finally, examining the long term implications of offshoring of software, we conclude that it is unlikely to pose a long term threat to American technological leadership. Instead, the U.S. economy will broadly benefit from the growth of new software producing regions. The U.S. technological leadership rests in part upon the continued position of the U.S. as the primary destination for highly trained and skilled scientists and engineers from the world over. Though this is likely to persist for some time the increasing attractiveness of foreign emerging economy destinations is a long-term concern for continued U.S. technological leadership.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 10538.

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Date of creation: Jun 2004
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Handle: RePEc:nbr:nberwo:10538

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O3 - Economic Development, Technological Change, and Growth - - Technological Change
O5 - Economic Development, Technological Change, and Growth - - Economywide Country Studies

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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    Other versions:
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  1. Supriyo De, 2007. "Software Production, Human Capital and Endogenous Growth: Theoretical Analysis and Empirical Evidence from India," DEGIT Conference Papers c012_007, DEGIT, Dynamics, Economic Growth, and International Trade. [Downloadable!]
  2. Chaminade, Cristina & Vang-Lauridsen, Jan, 2006. "Globalisation of Knowledge Production and Regional Innovation Policy: Supporting Specialized Hubs in Developing Countries," CIRCLE Electronic Working Paper Series 2006-15, CIRCLE (Centre for Innovation, Research and Competence in the Learning Economy), Lund University. [Downloadable!]
  3. K.J. Joseph, 2006. "Trade Liberalisation and Digital Divide: an Analysis of the Information Technology Agreement of WTO," Working Papers id:583, esocialsciences.com. [Downloadable!]
  4. Maurice Kugler & Hillel Rapoport, 2005. "Skilled Emigration, Business Networks and Foreign Direct Investment," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  5. J. Bradford Jensen & Lori G. Kletzer, 2005. "Tradable Services: Understanding the Scope and Impact of Services Outsourcing," Peterson Institute Working Paper Series WP05-9, Peterson Institute for International Economics. [Downloadable!]
  6. Chaminade, Cristina & Vang-Lauridsen, Jan, 2008. "Globalisation of Knowledge Production and Regional Innovation Policy: Supporting Specialized Hubs in the Bangalore Software Industry," CIRCLE Electronic Working Paper Series 2008-20, CIRCLE (Centre for Innovation, Research and Competence in the Learning Economy), Lund University. [Downloadable!]
    Other versions:
  7. Chaminade, Cristina & Vang-Lauridsen, Jan, 2006. "Building RIS in Developing Countries: Policy Lessons from Bangalore, India," CIRCLE Electronic Working Paper Series 2006-02, CIRCLE (Centre for Innovation, Research and Competence in the Learning Economy), Lund University. [Downloadable!]
  8. Devashish Mitra & Priya Ranjan, 2007. "Temporary Shocks and Offshoring: The Role of External Economies and Firm Heterogeneity," IZA Discussion Papers 2811, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  9. Chaminade, Cristina & Vang-Lauridsen, Jan & Coenen, Lars, 2007. "Learning from the Bangalore Experience: The Role of Universities in an Emerging Regional Innovation System," CIRCLE Electronic Working Paper Series 2007-04, CIRCLE (Centre for Innovation, Research and Competence in the Learning Economy), Lund University. [Downloadable!]
  10. Lori G. Kletzer, 2005. "Globalization and job loss, from manufacturing to services," Economic Perspectives, Federal Reserve Bank of Chicago, issue Q II, pages 38-46. [Downloadable!]
  11. Hongbin Cai & Yasuyuki Todo & Li-An Zhou, 2007. "Do Multinationals' R&D Activities Stimulate Indigenous Entrepreneurship? Evidence from China's "Silicon Valley"," NBER Working Papers 13618, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  12. Chaminade, Cristina & Vang-Lauridsen, Jan, 2008. "Upgrading in Asian clusters: Rethinking the importance of interactive-learning," CIRCLE Electronic Working Paper Series 2008-21, CIRCLE (Centre for Innovation, Research and Competence in the Learning Economy), Lund University. [Downloadable!]
    Other versions:
  13. Morissette, René & Johnson, Anick, 2007. "Offshoring and Employment in Canada: Some Basic Facts," Analytical Studies Branch Research Paper Series 2007300e, Statistics Canada, Analytical Studies Branch. [Downloadable!]
  14. Subramanyam, Ramanath & Xia, Mu, 2006. "Free/Libre Open Source Software Development in Developing and Developed Countries: An Exploratory Study," Working Papers 06-0110, University of Illinois at Urbana-Champaign, College of Business. [Downloadable!]
  15. Devashish Mitra & Priya Ranjan, 2005. "Y2K and Offshoring: The Role of External Economies and Firm Heterogeneity," NBER Working Papers 11718, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  16. Frédéric Docquier & Elisabetta Lodigiani, 2007. "Skilled Migration and Business Networks," Development Working Papers 234, Centro Studi Luca d\'Agliano, University of Milano. [Downloadable!]
    Other versions:
  17. Elisabetta Lodigiani, 2009. "Diaspora Externalities as a Cornerstone of the New Brain Drain Literature," Development Working Papers 277, Centro Studi Luca d\'Agliano, University of Milano. [Downloadable!]
  18. Padilla, R & Vang-Lauridsen, Jan & Chaminade, Cristina, 2008. "RIS and Developing Countries: Linking firm technological capabilities to regional systems of innovation," CIRCLE Electronic Working Paper Series 2008-13, CIRCLE (Centre for Innovation, Research and Competence in the Learning Economy), Lund University. [Downloadable!]
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