The effects of KIBS outsourcing on Aragon firms’ efficiency

Abstract

The use of Knowledge Intensive Business Services (KIBS) has become an essential element for competitiveness in modern economies. New competitive advantages often relate to capacity of innovation, the correct use of information and communication technologies, product design or market analysis, among others. The activities related to these new advantages require a great specialization in order to obtain high levels of efficiency. This is the main reason that explains the general tendency to contract externally KIBS. Nevertheless, externalisation is not necessarily a guarantee of efficiency. This paper focuses on Aragon, with a relatively under-developed supply of KIBS, and explores the effect of the use and external provision of these services on regional firms’ efficiency. We use a database of tertiary and secondary firms and apply a non-parametric approach, the DEA technique, to this analysis. Results show that the mere use of KIBS has no clear effect on efficiency, but such a clear effect can be observed when some types of these activities are externally consumed.