Geography of outsourcing: business service provisions among firms in Norway

This paper examines how business service provision partly relies on user firms’ internal resources, strategies and location depending on what can be obtained locally or is feasible to import elsewhere. Empirical evidence from small‐ and medium‐sized firms in three manufacturing industries in Norway shows that strategies searching for suitable suppliers can be divided into different categories, including one in which choice of service providers reflects a policy commitment to buy locally. A second type of strategy is when the choice of subcontractor is a result of a wide professional search process across regions in order to find the best alternative. A third is where service relations are co‐ordinated by a parent company or entail purchased goods. Finally, there is a group of firms that have left the matter of choice of service suppliers to brokers. These results add new elements to the discussion about the competitive role of industrial relations.