【正文】 usiness decisions and actions in one part of the world have significant consequences in other places. Underlying and reinforcing these globalization trends is the rapidly changing technological environment, particularly in biotechnology, information processing, and telemunications. Changes in telemunications and data processing capabilities make it possible to coordinate research, marketing and production operation around the world. Almost instantaneous munications makes it possible to trade financial instruments twentyfour hours a day: and thus more returnsensitive are location of resources within firms, industries and countries. The growth of global markets stimulates petition and forces governments to adopt marketoriented policies, both domestically and internationally. Modern technologies have greatly reduced the cost of information and the capabilities to participate in the global economy (Dunning, 1993). Countries must join the club. Policies that aim to exclude global participation via trade and investment barriers can be easily circumvented, and they keep no hostages but deprive the countries of global prosperity. Along with the globalization trend, contemporary technical advances are demanding a much closer synthesis and more integrative learning between innovative and production activities. 2 The pressures of global petition force producers to continually innovate, and to upgrade the quality of existing products. Yet, at the same time, many firms can no longer acquire or afford all the technological and human resources that they need. Increasingly, they form interdependent and flexible relationships with other firms – including suppliers and peting firms – to fully capitalize on their core petencies (GomesCasseres,1996). Interdependence calls for a capacity on the part of firms, individuals, and governments to interact with speed, flexibility and creativity to the actions of other agents (de la Mothe and Paquet,1996) In this new environment knowledge and intellectual labor are being mobilized on a more collaborative basis. Firms must develop human resource strategies based on synthesis with educational institutions. They must locate design and production facilities in metropolitan areas that allow partnerships with suppliers and educational institutions, and in places served by governments mitted to businessfriendly policies. The main form of economic organization in intermediary product markets is increasingly a work of inter firm cooperative arrangements, rather than the large hierarchical firm (Reich, 1992). Advancement in technologies and management skills have blurred firm boundaries. Before 1980 most FDI was of the “stand alone” variety. Each Multinational Enterprise (MNE) would exploit its own homebased petitive advantages and coordinate related intrafirm activities across national boundaries through internal mechanisms. More recently, however, MNEs are expanding their territorial and functional horizons by acquiring, or gaining access to, new resources and capabilities. The critical feature of strategic assetseeking FDI, as opposed to marketseeking FDI, is that participating firms recognize that their standalone resources and capabilities are insufficient to sustain their international petitiveness, and that they need to draw upon resources and capabilities of others to achieve this goal. While there are may reasons why firms form alliances with other firms, the great majority of those concluded over the past decade have been to gain access to new product or process, technologies and organizational petencies, especially those perceived necessary to advance their core petencies Globalization challenges management and students of business economics. According to conventional wisdom, most transnational business activities, particularly those involving FDI or crossborder alliances, are traditionally carried out by large firms. In addition, some people have believed that technological change requires increasingly large scale total operations, along with increasing size of research and development resources. These views would lead one to expect that small enterprises would decline in importance as they bee overwhelmed by global firms exploiting economies of scale. As the readers of this Journal well know, there is considerable evidence that these monly held views are no longer correct. Depending upon the measure of business size examined, the longterm trend toward increasing firm size either decelerated, ceased, or reversed itself sometime between the late 1960s and the late 1970s (Acs, 1996). This leads to an interesting question: “Is the apparent resurgence of smaller firms due to the emergence of a dynamic, vital innovative entrepreneurial sector, or is it due to the inability of large incumbent MNEs to prevail in a technologically dynamic global environment?” Harrison (1994) has argued that the role of SMEs has been overestimated, and that MNEs have been able to prosper in the new global environment by bining four basic building blocks: returning to their core petencies。 using new information technologies。 and eliciting more active 3 collaboration from their workers. However, this view overlooks the synergy between large and small firms, the strong attachment of small firms to their local economies, the role of small firms in technological change, and the role they play in the growth and evolution of industries (Acs, 1995). In fact, there is ample evidence that small and medium sized enterprise (SMEs) have not only flourished in domestic economies, but that their international presence has grown as well (UNCTAD, 1993。 Admiraal, 1996。D spillovers, strategic alliances, and the international diffusion of innovations. The papers appearing in this special issue of Small Business Economics are revised ver