Building a Workforce for the Information Economy by National Research Council

Author:National Research Council
Language: eng
Format: epub
Tags: Industry and Labor : Workforce and Labor Issues
Publisher: NATIONAL ACADEMY PRESS
Published: 2001-03-19T00:00:00+00:00

Or a firm that wishes to develop a new product line may locate work abroad because of opportunities afforded by its relative isolation—such isolation may help to insulate the unit undertaking the development from “cultural” dimensions extant in the mother firm's U.S. locations that are incompatible with developing the new product line.42 At other times, U.S. investment in overseas locations is part of a large package that a U.S. company has negotiated with a foreign country. For example, a U.S. company might agree to locate a facility in another nation as part of a sales agreement with that nation. A foreign facility might be established to reduce costs (e.g., through the use of cheaper labor, or by taking advantage of subsidies or incentives provided by the foreign host nation, or by overcoming locally imposed tariff barriers). Finally, the public relations value of being seen as a “local” company and the intellectual opportunities to collaborate in foreign research consortia should not be underestimated.43

42For example, a firm may have an engineering culture that values high performance and sophistication, with cost being a relatively secondary issue. If that firm wishes to develop products that are less expensive, it may well make sense to conduct the development of such products in an environment where that culture is not operative—which may call for geographical separation.

43More discussion of these rationales can be found in Dalton and Serapio, 1999, Globalizing Industrial Research and Development.

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