Columbia International Affairs Online: Working Papers

CIAO DATE: 06/2009

The Internationalization of Firms in the Service Industries: Channels, Determinants and Sectoral Patterns

Fulvio Castellacci

December 2008

Norwegian Institute of International Affairs

Abstract

The paper presents the results of a new survey on the international activities of Norwegian enterprises in various service industries. The survey focuses on three main internationalization channels: international sales, international cooperation and R&D outsourcing. The empirical analysis studies the relevance of these channels, and investigates the related strategies, objectives and determinants. International sales and collaborations emerge as the two most relevant channels, whereas the scope for R&D outsourcing seems to be far more limited. The analysis of the determinants of international activities suggests three main results: (1) the innovative capability of firms matters for their international performance; (2) the various internationalization channels seem to be complement, rather than substitute, strategies to compete in foreign markets; (3) sectoral specificities greatly affect firms’ internationalization strategies and performance.