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The Long-Run Performance of Born Globals in Computing: The Role of Digital Platforms

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  • Ferguson, Shon

    (Research Institute of Industrial Economics (IFN))

  • Henrekson, Magnus

    (Research Institute of Industrial Economics (IFN))

Abstract

Using data on all Swedish computing startups founded 2007–2015, we find a systematic positive relationship between the propensity of a computing firm to reach customers globally via digital platforms and its long-run employment growth relative to domestic-oriented computer firms. We also find positive, yet weaker, evidence that born globals in computing grow faster in terms of sales or value added. Our analysis also indicates that very few computing firms fit the profile of born globals; only 15% of the 250 largest computing employers in 2015 were born globals. Moreover, only 1.5% of computing startups founded 2007–2015 were computer game publishers, which arguably have the highest propensity to be born global. Thus, although we find positive born global effects at the firm level, policymakers must be aware that encouraging more born globals need not necessarily lead to large benefits for the overall economy.

Suggested Citation

  • Ferguson, Shon & Henrekson, Magnus, 2018. "The Long-Run Performance of Born Globals in Computing: The Role of Digital Platforms," Working Paper Series 1224, Research Institute of Industrial Economics, revised 23 Oct 2019.
    • Handle: RePEc:hhs:iuiwop:1224
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    References listed on IDEAS

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    More about this item

    Keywords

    Born globals; Computing industry; Exporting; Firm growth; Globalization; Job creation;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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