Handbook of Research on International Entrepreneurship
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Handbook of Research on International Entrepreneurship

Edited by Léo-Paul Dana

This unique reference book provides an array of diverse perspectives on international entrepreneurship, a new and emerging field of research that blends concepts and methodologies from more traditional social sciences. The Handbook includes chapters written by top researchers of economics and sociology, as well as academic leaders in the fields of entrepreneurship and international business. State-of-the-art contributions provide up-to-date literature reviews, making this book essential for the researcher of entrepreneurship and the internationalisation of entrepreneurs.
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Chapter 19: The Case of Canadian Computer Software Firms

Rod B. McNaughton and Peter Brown


19 The case of Canadian computer software firms Rod B. McNaughton and Peter Brown The concept of ‘clustering’ is now central to the design of economic development policies in many countries. The belief is that co-located firms experience externalities that improve their performance, and contribute to their innovativeness and international competitiveness. These benefits arise from access to factors of production, and highly localized inter-firm relationships facilitated by place-specific history, economic factors, values and culture (Sabel, 1989; Becattini, 1990). The theory to support this argument comes from a diverse literature including Porter’s (1990) work on the creation of competitive advantage, the concepts of both milieu and industrial districts (for example, Camagni, 1991), and research that stresses the role of locally specific knowledge and learning (for example, Malmberg, 1997). The benefits of co-location are also thought to help firms increase the scope of their markets, and clusters are increasingly seen as a driving force in international trade (Brown and McNaughton, 2002). Clusters are credited with providing an environment in which world-leading technology can be developed, credibility and reputation can be established, and linkages can be developed to gain access to international markets. However there is relatively little empirical evidence to show whether firms located in clusters indeed derive more of their total sales from foreign markets. This chapter reports research that tests whether co-located firms are more export-intense, using a sample of 537 Canadian software firms drawn from an Industry Canada directory. Firms in the sample include...

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