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the potential for regionalising internationally traded services

PRTLI_ITSREG

This is one of the five major Whitaker Institute projects financed under Cycle 3 of the PRTLI (Programme of Research in Third Level Institutions) managed by the Higher Education Authority under the Irish Government's National Development Plan.

Background

The attraction of Foreign Direct Investment (FDI) in the Information and Communications Technology (ICT) sector and in internationally traded services generally has been a key component of Irish economic development strategy for more than 25 years. Despite the considerable improvement in Irish economic performance in recent years, the high level of dependence on foreign investment together with the relative weakness of the indigenous sector, has resulted in a number of continuing concerns. Among these are the lack of embeddedness of foreign capital in the local economy (O'Sullivan, 2000; Andreosso-O'Callaghan, 2000); the generally low level in the value chain of activities located in Ireland; the significant vulnerability of activities such as software localisation, logistics and telemarketing as a result of rapid technological change; and the fact that the key competencies of software development and marketing have tended not to be located in Ireland (O'Riain, 1999; O'Sullivan, 2000).The significant concentration of ICT and internationally traded service activities in the Dublin region in recent years has given rise to rapid economic growth and the resultant problems associated with overdevelopment such as scarcity of high technology skills, overheating of the housing market and over-congestion, resulting in a lowering of the quality of life. As a result of these developments there has been a greater commitment towards developing a regional development policy, and together with the fact that the Border Midland and West (BMW) regions are now the only parts of the country which will be entitled to EU structural funds, there are greater opportunities than previously for promoting a more balanced spread of investment. Efforts to regionalise ICT-related investment to date, however, have been modest. This study will explore the evolving spatial pattern of this investment in Ireland and seek to identify the barriers to a greater level of regionalisation.

Project Leader:

Professor Seamus Grimes

Participants:

Dr Patrick Collins

Professor Seamus Grimes

Konstanze Hoechtberger

Dr Mark White

Technical Description

Task 1
To determine the extent to which Ireland as a peripheral European region has benefited from the restructuring of ICT-related investment

The rapidly growing interdisciplinary literature dealing with the emerging information economy in countries with some similarity to Ireland such as Scotland, Israel and Singapore will be explored in order to develop an explanatory model of ICT-related foreign direct investment. Among the specific issues to be explored will be the upgrading of ICT investment by MNCs and their embeddedness in the local economy, linkages with indigenous companies, and the acquisition of innovative SMEs by MNCs.

Task 2

Investigation of the processes of centralisation and decentralisation of ICT and internationally traded services investment

This task will map the evolving spatial pattern of ICT-related investment internationally traded services investment in Ireland. A comprehensive database of companies involved in internationally traded services will be constructed. In-depth interviews with significant actors in the policy area and with a sample of foreign-owned and indigenous ICT companies in software and internationally traded services will be carried out. The analysis will seek to explain the processes of centralisation and decentralisation of investment and the extent to which the investment in the Dublin region is qualitatively differentiated to that in other regions.

Publications, presentations etc, for this project:

Please visit the Project Participants' webpage for details of publications associated with this research.

 

    

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