Sardinia is a small regional economy that cannot rely on its local market to achieve the levels of efficiency guaranteed by the exploitation of economies of scale. The choice of internationalization is therefore crucial for the island to enhance its economic development process. The goal of this project is to analyze the factors that influence the Sardinian economic internationalization process, which could be related to the degree of involvement in the flows of goods and services or to the degree of attractiveness of Sardinia as a foreign direct investments destination. The research will be carried out within the theoretical framework of the New Economic Geography (NEG), which has identified in the increasing returns in transportation costs and in the scarcity of production factors the main determinants of the production outsourcing choices, and of the “New New Trade Theory” (NNTT), closely connected to the NEG, according to which the most productive firms internationalize more easily and resist higher competition. The analysis aims 1) to identify the factors that have so far prevented Sardinian companies to sell their products in the foreign markets, for which the condition of insularity plays a fundamental role, and 2) to single out the opportunities offered by the international service markets, which being intangible and weightless, could represent a promising prospect to strengthen the productive specialization of Sardinia.   Scientific referee: Stefano Usai (stefanousai@unica.it) Project Manager: Margherita Meloni (margherita.meloni@crenos.unica.it)   The project is funded by Regione Autonoma della Sardegna (L.R. 7/2007).   For more information click here.