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Property rights and international investment in information technology services


Correspondence to: Srividya Jandhyala, George Washington University, 2201 G Street NW, Funger Hall 401, Washington, DC 20052, U.S.A. E-mail:


Many modern information technology services are increasingly being produced in a host country to serve clients in an offshore location. As a result, the internationalization of service functions is beginning to resemble that of their more traditional manufacturing counterparts. This paper examines the role of formal and de facto property rights protection in the offshore location choice of information technology services. I also explore the role of a firm's global subsidiary network and its experience with similar property rights regimes. Using investment data based on 152 firms and their international information service investments between 2002–2006, the empirical results highlight the role of de facto property rights protection and related experience in location choice.Copyright © 2012 John Wiley & Sons, Ltd.