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application/pdf, The problem of firm location can be directly relevant to location decision-making of firms. To attract firms, host regions must have sufficient locational advantages. First, this article studies what constitutes elements for business firms in terms of regional externalities. The structure of a hierarchical urban system may be used to describe the relationship between economies of scale and/or scope and access to economic markets. Then, the argument is expanded to the optimal regional planning strategy according to the type of local characteristics. The final part explores how the limited scale and/or scope of small regions can be spatially competitive against other regions in the borderless global economy. A trigger strategy for cooperative behaviour utilising local allocation of resources is also examined.

For a long time, it was assumed that hard location factors (e.g. workforce, land) were the primary influence on the location decisions of firms. In the course of the tertiarization of the economy and linked increases in the qualification of employees as well as changes in values and timemodels, soft location factors (e.g. image, cultural offerings) are expected to gain in importance. Therefore, this paper examines whether the importance of soft location factors has really increased in comparison to traditional, hard location factors. For this purpose, company surveys conducted by the Chamber of Commerce and Industry Mittlerer Niederrhein (Germany) in 2002 and 2017 are analysed. More than 1,000 firms took part in both surveys and evaluated more than 50 location factors in terms of their importance. The results of the study show that the importance of soft location factors related to quality of life (e.g. safety, image) and the city centre (e.g. parking) increased significantly over this time period. In comparison, the importance of the hard location factors stagnated or even decreased (without including the factor information and communication infrastructure). These results provide indications for the local authorities concerning which site conditions are important for retaining firms or attracting new companies in the future. Lange Zeit ging man davon aus, dass harte Standortfaktoren (z.B. Arbeitskräfte, Flächen) die Standortentscheidungen von Unternehmen vorrangig beeinflussen. Im Zuge der Tertiarisierung der Wirtschaft und den damit verbundenen gestiegenen Qualifikationen der Beschäftigten sowie der Veränderung der Werte und Zeitmodelle, sollen jedoch weiche Standortfaktoren (z.B. Image, Kulturangebote) zunehmend an Bedeutung gewinnen. Der vorliegende Beitrag geht daher der Frage nach, ob die Relevanz weicher Standortfaktoren tatsächlich im Vergleich zu den traditionellen, harten Standortfaktoren zugenommen hat. Dafür wurden Unternehmensbefragungen der Industrie- und Handelskammer Mittlerer Niederrhein aus den Jahren 2002 und 2017 analysiert. An beiden Befragungen nahmen mehr als 1.000 Unternehmen teil und bewerteten über 50 Standortfaktoren hinsichtlich ihrer Wichtigkeit. Die Ergebnisse der Studie zeigen, dass insbesondere die Bedeutung von weichen Standortfaktoren, die in Zusammenhang mit der Lebensqualität (z.B. Sicherheit, Image) und der Innenstadt (z.B. Verfügbarkeit von Parkplätzen) stehen, in dem Zeitraum signifikant gestiegen sind. Im Vergleich dazu stagniert oder sinkt (ohne Einbeziehung des Faktors Informations- und Kommunikationsinfrastruktur) die Wichtigkeit der betrachteten harten Standortfaktoren. Diese Ergebnisse liefern Hinweise für die regionalen Akteure, welche Standortgegebenheiten wichtig sind, um zukünftig Unternehmen weiterhin an den Standort binden bzw. neue Unternehmen für den Standort gewinnen zu können.

We investigate whether localities gain or lose employment when there are connected to a transportation network, such as a high-speed railway line. We argue that long-haul economies—implying that the marginal transportation cost decreases with network distance—play a pivotal role in understanding the location choices of firms. We develop a new spatial model to show that improvements in transportation infrastructure have nontrivial impacts on the location choices of firms. Using data on Japan’s Shinkansen, we show that ‘in-between’ municipalities that are connected to the Shinkansen witness a sizable decrease in employment.

The municipality of Paris decided in August 2015 to renew its approach to rent control. New rents were not to exceed a given ceiling, being capped at the median rent per square metre plus 20%, for each category of dwelling (number of rooms, neighbourhood, and period of construction). This paper analyses the effects of the policy. We showthat the ceilingmet with only partial compliance, as 20% of rents exceeded the ceiling after August 2015. We then demonstrate the distortive effect of the rent control design. Ceilings were based on the number of rooms and failed to recognise that floor area can vary widely between dwellings with the same number of rooms. Dwellings with small rooms were more constrained by the rent ceilings, and were the only dwellings for which rents fell following implementation of the new controls., En août 2015, la ville de Paris a renforcé son dispositif d’encadrement des loyers. Les nouveaux loyers ne devaient pas dépasser un certain plafond, défini comme le loyer au mètre carré médian par catégorie (nombre de pièces, grand quartier et époque de construction) majoré de 20 %. Cet article analyse l’impact de ce nouveau dispositif. On montre que l’encadrement n’a été que partiellement respecté : 20 % des loyers se situent au-dessus des plafonds après août 2015. On démontre ensuite que le dispositif d’encadrement est distorsif. Le calcul des plafonds est distinct par nombre de pièces mais ne tient pas compte du fait que des logements disposant du même nombre de pièces peuvent avoir des surfaces très différentes. Ainsi, les logements à petite surface par pièce (ou logements à petites pièces) sont plus contraints par les plafonds. En conséquence, seuls les loyers de ces logements diminuent après la mise en place de l’encadrement., Malard Louis, Poulhès Mathilde. Encadrement des loyers à Paris : les logements à petites pièces plus contraints que les autres. In: Économie & prévision, n°217, 2020. pp. 1-41.

This paper presents an agent based model of firm location designed to explore the effect of regional policies on the spatial pattern of business activity. New firms are created each period taking into account the sector profitability and entry barriers. Firms choose their location and then they decide sequentially whether change their size or cease their activity accordingly to the profit maximization principle and the limited information they have. Their costs depend not only on the production level and the price of the productive factors but also on the land price. The characteristics of the territory where the firms are located are not static but rather evolve depending on the public policies, demographic variables and the firm localization patterns. The presented model shows endogenous rules of firm localization as well as the effects in the medium and long term of public policies.

There exists now a large body of theoretical and empirical literature that shows that transport costs for goods and people affect firm location in multifaceted ways and that changes in transport cost have important implications for the reorganization of firms across space. Transport cost reductions can either induce the agglomeration or dispersion of firms, depending on the initial level of transport cost, the type of activity, and the spatial scale of analysis. This article reviews the substantial contributions that have been made toward a better understanding of the relationship between transport cost and firm location. Recent trends and implications of technological change are pointed out.

This article analyses the effect of immigration flows on the growth and efficiency of manufacturing firms in Spanish cities. To date, most studies have tended to focus on the effect immigrants have on labour markets at an aggregate level. Here, however, we undertake an exhaustive analysis at the firm level and report conclusive empirical findings. Ten years ago, Spain began to register massive immigration flows, concentrated above all on its most dynamic and advanced regions. Here, therefore, rather than focusing on the impact this has had on Spain's labour market (changes to the skill structure of the workforce, increase in labour supply, the displacement of native workers, etc.), we examine the arrival of immigrants in terms of the changes this has meant to the structure of the country's cities and their amenities. Thus, we argue that the impact of immigration on firm performance should not only be considered in terms of the labour market, but also in terms of how a city's amenities can affect the performance of firms. Employing a panel data methodology, we show that the increasing pressure brought to bear by immigrants has a positive effect on the evolution of labour productivity and wages and a negative effect on the job evolution of these manufacturing firms. In addition, both small and new firms are more sensitive to the pressures of such immigrant inflows, while foreign market oriented firms report higher productivity levels and a less marked impact of immigration than their counterparts. In this paper, we also present a set of instruments to correct the endogeneity bias, which confirms the effect of local immigration flows on the performance of manufacturing firms.

The literature provides empirical evidence on the importance of geographic location for an effective provision of knowledge intensive business services (KIBS). According to the postulates of territorial servitization, KIBS are also fundamental for the development of manufacturing firms. Despite this, KIBS can be an important source of innovation. In Latin America there is still little attention paid to KIBS, both from academia and from policy makers. The purpose of this research is to analyse the relationship between KIBS co-locations and the innovativeness of the manufacturing firms in context of emerging countries. Drawing on the World Bank Enterprise Survey (WBES) for Latin-American countries, authors analysed 3,029 manufacturing firms using the OLS method. Findings indicated that manufacturing firms’ locations based on KIBS proximity, is a critical determinant of innovativeness. This relationship is considerably stronger in Central American countries, while in South America this relationship is negative, which leads to debate., Directorate of Institutional Relations (DARI) of the Pontifical Catholic University of Peru DARI/064-2018

This study examines the spatial association between science- and technology-related entrepreneurship and neighbourhood walkability in eastern Nebraska, often referred to as the northern ‘Silicon Prairie’. Tech start-up firms are expected to gravitate toward more walkable or pedestrian-oriented urban locations to benefit from heightened social interaction, knowledge spillovers and a more vibrant, creative atmosphere. Data on start-up firms collected from the online database Crunchbase.com and a walkability index provided by the popular online service Walk Score® were used to evaluate the walkability–tech entrepreneurship nexus. The spatial relationship between walkability and firm location may have important implications for metropolitan areas seeking to incubate new firms and industries in situ, and potentially become leaders in new, innovative industries.

This study presents novel evidence regarding the role of regional internet infrastructure in reducing regional per capita income disparities. We base our study on the assumptions that (1) the diffusion of information homogenizes regional economies through reducing the dissimilarities in institutions and culture, and (2) the telecommunication capacity, represented by the internet infrastructure of a region, facilitates this flow of information. Using the data from the 26 statistical NUTS-2 regions of Turkey for the period 1999-2011, we find evidence that internet infrastructure increases the speed of regional convergence.

This study presents novel evidence regarding the role of regional internet infrastructure in reducing regional per capita income disparities. We base our study on the assumptions that (1) the diffusion of information homogenizes regional economies through reducing the dissimilarities in institutions and culture, and (2) the telecommunication capacity, represented by the internet infrastructure of a region, facilitates this flow of information. Using the data from the 26 statistical NUTS-2 regions of Turkey for the period 1999-2011, we find evidence that internet infrastructure increases the speed of regional convergence.

Innovation is one of the major drivers of economic growth, where spatial processes of knowledge spillover play a vital role. Current practices in assessing firms innovation activity, including patent analysis and questionnaires, suffer from severe limitations. In this paper, we propose a novel approach to estimate firms innovation activity based on the texts on their websites. We use an automated web-scraper to harvest text from the websites, then extract semantic topics in a self-learning, generative topic-modelling approach, and finally analyse these topics using an Artificial Neural Networks (ANN) method to assess each firms level of innovation. This procedure results in a large-scale dataset that will be used for further spatial economic analysis of the distribution of innovative firms and the processes that drive the development of innovation in firms. (VLID)4339068

The literature provides empirical evidence on the importance of geographic location for an effective provision of knowledge intensive business services (KIBS). According to the postulates of territorial servitization, KIBS are also fundamental for the development of manufacturing firms. Despite this, KIBS can be an important source of innovation. In Latin America there is still little attention paid to KIBS, both from academia and from policy makers. The purpose of this research is to analyse the relationship between KIBS co-locations and the innovativeness of the manufacturing firms in context of emerging countries. Drawing on the World Bank Enterprise Survey (WBES) for Latin-American countries, authors analysed 3,029 manufacturing firms using the OLS method. Findings indicated that manufacturing firms’ locations based on KIBS proximity, is a critical determinant of innovativeness. This relationship is considerably stronger in Central American countries, while in South America this relationship is negative, which leads to debate., La literatura proporciona evidencia empírica sobre la importancia de la localización geográfica para una efectiva provisión de KIBS. Según los postulados de la servitización territorial, los KIBS también son fundamentales para el desarrollo de las empresas manufactureras. A pesar de que los KIBS puede ser una fuente importante de innovación, en América Latina aún se presta poca atención a los KIBS, tanto desde la academia como de los responsables políticos. El propósito de esta investigación es analizar la relación entre la co-localización de los KIBS y la innovación de las empresas manufactureras en contextos de países emergentes. En base a la Encuesta Empresarial del Banco Mundial (WBES) para países de América Latina, los autores analizan 3.029 empresas manufactureras utilizando el método MCO. Los resultados indican que la localización de las empresas manufactureras basadas en la proximidad de los KIBS es un determinante crítico de la innovación. Esta relación es considerablemente más fuerte en los países centroamericanos, mientras que en América del Sur esta relación es negativa, lo cual conlleva a un debate.

Place-based policies target specific geographic areas for special treatment. They attempt to stimulate growth and development in lagging regions by (1) attracting firms, (2) attracting workers and human capital, and (3) improving local public goods. This report conducts a critical review of place-based policies that have been implemented in Indonesia since Suharto's presidency. It examines the evolution of different policies and programs, aiming to understand whether these programs have increased prosperity, improved livability, or promoted greater inclusiveness for lagging regions. We begin by describing the evolution of central and local policymaking in Indonesia, providing the context through which place-based policies operate. We then review place-based policies that affect firm location choices, improve schooling and health for workers, and provide social assistance for people in lagging areas, evaluating their strengths and weaknesses. We conclude by offering recommendations to improve and redirect place-based policymaking in the future.

In the U.S., states compete to attract firms by offering discretionary subsidies, but little is known about how states choose their subsidy offers, whether such subsidies affect firms' location choices, and what effect the subsidies have on economic growth. In this dissertation, I leverage a unique, hand-collected dataset on state incentive spending and subsidy deals to provide new evidence on state subsidy-giving and economic development policies. In Chapter 1, I use an oral ascending (English) auction to model the subsidy "bidding" process and estimate the efficiency of subsidy competition. The model allows state governments to value both the direct and indirect (spillover) job creation of firms when submitting bids, and firms to take both subsidies offered and state characteristics into account when choosing their location. I estimate both the distribution of states' (revealed) valuations for firms that rationalizes observed subsidies, and firms' valuations for state characteristics. In order to allow states to value potential spillovers, I estimate the effect of subsidy-winning firms' locations on the entry decision of smaller firms. I provide the first empirical evidence that states use subsidies to help large firms internalize the positive spillovers, in the form of indirect job creation, they have on the states. Moreover, subsidies have a sizable effect on firm location. With subsidies, total welfare (the sum of state valuations and firm profits) increases by 22%, but the welfare gain is captured entirely by the firms. In the second chapter, I study political motivations for subsidy-giving. I identify the effect of corporate campaign spending on state subsidy-giving to firms by exploiting variation created by the 2010 Citizens United v. FEC Supreme Court case, which allowed corporations to spend on elections in 24 states that previously had spending bans. I find that treatment states are 23 percentage points more likely to give a second subsidy to a firm that is already located in the state. My results suggest that campaign spending is likely a factor in states' subsidy-setting decisions. Lastly, in joint work with Owen Zidar, I spend more time describing the structure of state business incentives, and provide some preliminary analysis on whether or not they work. We compare "winning'' and runner-up locations for each subsidy deal, and do not find strong evidence that discretionary subsidies increase employment and economic growth within a county. Overall, firms make location and investment decisions to maximize after-tax profits, which depend strongly on non-tax factors such as wages, market access, productivity, and amenities. Although larger establishment shares are associated with higher per capita incentive spending at the state level, increases in incentive spending do not lead to increases in establishment entry, as poorer places are more likely to provide larger incentives.

In this paper, we analyse the effects of a unilateral change in an emissions tax in a model of international trade with heterogeneous firms. We find a positive effect of tighter environmental policy on average productivity in the reforming country through reallocation of labour towards exporting firms. Domestic aggregate emissions fall, due to both a scale and a technique effect, but we show that the reduction in emissions following the tax increase is smaller than in autarky. Moreover, general equilibrium effects through changes in the foreign wage rate lead to a reduction in foreign emissions and, hence, to negative emissions leakage in case of transboundary pollution.

Aggregated models, such as spatial interaction (SIM) models are widely used in location analysis. Despite their popularity, there are certain limitations to their use. In particular, the method struggles to account for the passing-by population and multi-purpose trips of retail clients, temporal changes in accessibility and some bottom-up processes potentially important for services. Agent-based modelling (ABM) is a promising technique that attempts to address all these problems. However, it still lacks examples of real-world applications. This article aims to provide an example of how hybrid ABM (H-ABM) can be built on a SIM foundation, by incorporating most of its ideas, such as distance-decay function, facility attractiveness parameters and demand elasticity. The author aligns the two models as close as possible and compares their input data, calibration procedures and results. In the final analysis, the hybrid agent-based model proved to be more realistic because it incorporated the time-space variability of supply (i.e., limited numbers of available places in swimming pools), demand (the popularity of certain entry hours) and transport (traffic jams during rush hours). The spatial interaction model was much faster to execute and turned out to be more convenient for more straightforward applications, which do not require detailed data concerning individuals.

The loss of international competitiveness of domestic industries remains a key obstacle to the implementation of effective carbon prices in a world without harmonized climate policies. We analyze countries' non-cooperative choices of emissions taxes under imperfect competition and mobile polluting firms. In our general equilibrium setup with trade, wage effects prevent all firms from locating in the same country. While under local or no pollution countries achieve the first-best, under transboundary pollution taxes are inefficiently low and lower than under autarky where only the `standard' free-riding incentive distorts emissions taxes. This effect is more pronounced when polluting firms are mobile.

This research examines the relationship between places and firms and how this contributes to competitive advantage. This is a vitally important topic at present, as businesses are adjusting to the dislocations of Brexit, trade wars, nationalism and other reactions to globalisation. Firms need a place strategy more than ever. How should resources be located in relation to markets, suppliers, skilled workers, laws, incentives, infrastructure, quality of life and the myriad other factors affecting business? Global connectivity presents so many options but also so many threats. Despite its importance, this is a subject that is relatively poorly served by existing literature and theory. A review of strategic management work relating to competitive advantage, including reflections on Chandler, Ansoff, Porter, Barney, Mintzberg, and many other authors, reveals an emphasis on management and organisation but a virtual blindness to the role of place. A review of economic geography literature related to competitive advantage, including consideration of work from Marshall to Maskell, Storper, Sassen, Glaeser, Florida and many others, shows an emphasis on place but a relative neglect, with only a few significant exceptions, for the view from the firm and the role of individuality in organisation and management. The two disciplines show a striking complementarity in their omissions. This interdisciplinary study draws on the wide range of existing material to build a new and comprehensive model of the place-firm relationship (the PFR) that brings convergence to the thinking around competitive advantage. This model is then tested and adjusted through empirical research leading to recommendations for firm strategy, government policy, academic theory and future research. The empirical study is based on the most important business sector in the UK in terms of size, growth and impact, namely financial services, and is set in the top two centres of activity in the UK for this sector outside London, namely Edinburgh and Glasgow. At the heart of the work is a series of 29 semi-structured, in-depth interviews with senior executives in these cities investigating how firms see the contribution of place to their competitive advantage, a necessarily qualitative methodology to unravel the complexity and contradictions inherent in the existing theory. The interviews have been transcribed and coded and analysis of the feedback has been used to both refine the new model and to derive insights about how it works in practice. The results of the application of the model show that the PFR is highly complex but also that it can be rigorously assessed and the key factors contributing to competitive advantage can be identified and prioritised. These factors can be grouped under the main themes of the ease of doing business, talent, quality of life, local networks and legacy. It is clear that every business enjoys a unique PFR but that the individual organisational profiles can be aggregated in line with the main themes to show agglomeration and cluster effects around places, industry sectors, types of business and other groupings. In the case of the financial services businesses tested here, the availability of talent stands out as the most important contribution to competitive advantage firms receive from places, but this is closely linked to other factors in a web of connections. Also evident is the pragmatic co-existence of competition and collaboration in firm strategies and practice and the emergence of different but overlapping cluster types, particularly one underpinned by legacy in Edinburgh and the other underpinned by government intervention in Glasgow. This research gives business managers a tool and methodology with which to assess and compare how place contributes to their competitive advantage. It thus gives an added vital dimension to most strategic decisions and particularly to considerations about relocation, expansion, off-shoring, and geographical dispersal and diversification. The agility necessary for businesses to respond to the current turbulent political and economic environment must extend to managing place and place-firm relationships in the more systematic way proposed in this work in order to maintain and extend competitive advantage. This model can also help development agencies and national and local government to interpret the competitive advantages of places as seen by firms and to make comparisons with other places. It can give an informed basis for discussion with businesses and point to where improvements can be made in line with the place objectives and overall development plans. The new model gives a common framework for different parties to reconcile their objectives to mutual benefit. Last but not least, the research presents academics with possibilities for more interdisciplinary work to address gaps in theory about one of the most pressing issues of the day. The model opens the door to new research opportunities to test its applicability in different combinations of places, businesses and industry sectors, for different types of agglomeration and cluster formation. This is an opportunity for the academic research community to furnish the objective, sound and informed view necessary to support potentially controversial decision making in these uncertain times.

This paper identifies the factors that affect the location of firms in Tanzania. Using a binomialeconometric strategy to address data gaps in firm location at the ward level, the paper groups factors into firm characteristics, market features, and two types of agglomeration economies that capture economies of scale external to the firm. The benefits of agglomeration may stem from specialization within and among firms (referred to in the literature as localization economies) or from diversification across firms (referred to as urbanization economies). The distinction between these two lies at the heart of the discussion on firm location. Regression results indicate that, of the various factors tested, the most important determinant driving firm location is the jobs diversification aspect of urban economies. Other contributing factors are localization economies (jobs specialization), competitive markets, and market access. Based on these findings, policymakers seeking to foster agglomeration could orient policies toward promoting firm entry within cities, complementary investments in urban infrastructure and the urban pool of labor, regulations that support competition, and improvements in market access for large cities. But localization economies are also significant in Tanzania, and could be encouraged through investment in smaller population centers and increasing competition and market access beyond the primary urban centers of Dar-es-Salaam and Arusha.

This study presents novel evidence regarding the role of regional internet infrastructure in reducing regional per capita income disparities. We base our study on the assumptions that (1) the diffusion of information homogenizes regional economies through reducing the dissimilarities in institutions and culture, and (2) the telecommunication capacity, represented by the internet infrastructure of a region, facilitates this flow of information. Using the data from the 26 statistical NUTS-2 regions of Turkey for the period 1999-2011, we find evidence that internet infrastructure increases the speed of regional convergence.

Transport connectivity is among the most important factors in increasing firm productivity and accelerating economic development. The literature generally supports the idea of agglomeration economies, although there is little evidence of their effectiveness in Africa. There are often empirical challenges, such as spatial externalities and endogeneity of infrastructure development. Using firm registry data in Liberia, this study used the instrumental variable spatial autoregressive model to examine the effects of transport connectivity on firms' decisions on where to locate. The study found significant spatial autocorrelation and possible endogeneity related to transport infrastructure, and that firms are more likely to be located where market accessibility is better. The data indicated strong agglomeration economies, indicating that the primary city, Monrovia, is likely to continue to grow and attract more people and firms, and that secondary cities can also grow with greater transport connectivity between populated areas, such as district centers.

In the global market, food sales are connected with two opposing trends. On one hand, new markets are appearing and the number of suppliers is increasing as well as the range of goods. On the other hand, the growth in the number of producers means intensification of competition. Local food producers have to deal with the optimal location problem for their outlets, taking into account potential and existing competitors. The solution to the problem can be based on spatial competition theory conclusions particularly using some spatial competition models. The given methodology is chosen for the research purposes. The article gives some definitions of such concept as «economic space» and «spatial competition», which enables the analysis and helps find disadvantages of the existing spatial competition models. The agent's economic space is created for differentiation of interests and is a result of the competition. Spatial competition is an imperfect competition of producers (dealers) for the share of market space by means of price tools. Some regressions are built to look into relations between the number and density of firms and the number and density of population in the cities. The analysis is based on real data about shops' locations in Siberia Federal District. It is found that there is not any dependence between wages and the number and density of population in the cities. The built regressions show that additional centripetal forces exist in the cities. It means that simple theoretical models of spatial competition describe the reality inaccurately and it's more useful to apply more sophisticated models. So, the competition level depends on the agent's location. The competition is decreasing near administrative borders because the price is higher due to transport costs. However, diminishing of transport costs can lead to the concentration of production in large markets or near them.

The aim of this dissertation is to contribute to the discussion on the effects of public inputs, goods and services (PIGS) on households’ and firms’ location decision. This work contributes to the debate providing greater insights on the empirical effects of PIGS on spatial mobility using detailed data for Germany. Chapter 2 assesses the short and long run impact of local grammar schools on employment in East German municipalities and finds evidence in favor of a 9% decrease in residential employment (those who work where they live) in locations with a low share of out-commuters and a reduction of house prices by 7% to 11% for all locations types if the only grammar school was closed. For the long-run since 1990, the empirical strategy estimates a 110% higher population and 70% higher house prices in municipalities with a grammar school in 2008 and high commuting costs. The effects in municipalities with low-commuting costs are 60% and 20% respectively. These results suggest that e.g. grammar schools, and thus public goods can play a substantial role for the spatial distribution of people and employment. More importantly, it demonstrates that increasing centralization of public goods in rural areas fortifies the trend in urbanization. Chapter 3 determines the effect of PIGS provision on firm foundation and location choices. Using data for West Germany it tests the implications of a theoretical model for firms’ location choice and identifies a negative effect of taxation and a positive effect of PIGS provision in the considered municipality. On top, the effect of an increase in neighbors tax rate and PIGS spending is positive supporting the notion of tax competition and spillover effects for PIGS between neighboring municipalities. Chapter 4 contributes to the previous chapter analyzing the sensitivity of firm foundations to changes in local taxation and PIGS provision when firms benefit from localization economies. While the former chapter depicts increasing attractiveness of locations with increasing provision of PIGS, an empirical setup shows that localization economies reduce the sensitivity of firm foundations to changes in location characteristics. The last chapter analyzes the impact of partisan politics on the local level in West Germany. Using three different estimation frameworks (Fixed Effects Regression, Regression Discontinuity Design and Instrumental Variable Regression) it does find evidence for mild partisan politics at best.

While the effects of non-geographic aggregation on statistical inference are well studied in economics, research on the effects of geographic aggregation on regression analysis is rather scarce. This knowledge gap, together with the use of aggregated spatial units in previous firm location studies, results in a lack of understanding of firm location determinants at the microgeographic level. Suitable data for microgeographic location analysis has become available only recently through the emergence of Volunteered Geographic Information (VGI), especially the OpenStreetMap (OSM) project, and the increasing availability of official (open) geodata. In this paper, we use a comprehensive dataset of three million street-level geocoded firm observations to explore the location pattern of software firms in an Exploratory Spatial Data Analysis (ESDA). Based on the ESDA results, we develop a software firm location prediction model using Poisson regression and OSM data. Our findings offer novel insights into the mode of operation of the Modifiable Areal Unit Problem (MAUP) in the context of a microgeographic location analysis: We find that non-aggregated data can be used to detect information on location determinants, which are superimposed when aggregated spatial units are analyzed, and that some findings of previous firm location studies are not robust at the microgeographic level. However, we also conclude that the lack of high-resolution geodata on socio-economic population characteristics causes systematic prediction errors, especially in cities with diverse and segregated populations. (VLID)2386486

In this article, we study the impact of a French enterprise zone program—the ‘Zones Franches Urbaines’ (ZFUs) policy—on establishment location decisions and on labor market outcomes. Our main identification strategy, which combines spatial and time differencing, shows that conditional on locating in a municipality that hosts a ZFU, the policy has a positive and sizable impact on the probability to locate in the ZFU part rather than in the non-ZFU part of municipalities. However, the impact is highly heterogeneous across zones, industries and firms. We also show that this positive effect is entirely due to within-municipality diversion effects. Regarding labor market outcomes, the policy has a positive effect on employment, especially for low-wage workers. As for wages, the effect is null for low-wage workers, and negative for high-wage ones.

This study addresses the locational puzzle concerning the optimization of firm and residential locations faced by highly educated self-employed entrepreneurs. In contrast to employees, the self-employed have considerable leverage in changing their firm location, which gives them an additional option - apart from a residential move - to resolve household locational issues. Two results stand out. Firstly, firms are generally located very close to the residential location. This reinforces the idea that entrepreneurship is a local event. Secondly, if other economic activities need to be considered, firm relocation is often used to resolve the locational puzzle.

While the effects of non-geographic aggregation on inference are well studied in economics, research on geographic aggregation is rather scarce. This knowledge gap together with the use of aggregated spatial units in previous firm location studies result in a lack of understanding of firm location determinants at the microgeographic level. Suitable data for microgeographic location analysis has become available only recently through the emergence of Volunteered Geographic Information (VGI), especially the OpenStreetMap (OSM) project, and the increasing availability of official (open) geodata. In this paper, we use a comprehensive dataset of three million street-level geocoded firm observations to explore the location pattern of software firms in an Exploratory Spatial Data Analysis (ESDA). Based on the ESDA results, we develop a software firm location prediction model using Poisson regression and OSM data. Our findings demonstrate that the model yields plausible predictions and OSM data is suitable for microgeographic location analysis. Our results also show that non-aggregated data can be used to detect information on location determinants, which are superimposed when aggregated spatial units are analysed, and that some findings of previous firm location studies are not robust at the microgeographic level. However, we also conclude that the lack of high-resolution geodata on socio-economic population characteristics causes systematic prediction errors, especially in cities with diverse and segregated populations.

he main aim of this article is to propose a system of effective business support tools at the region and municipality level, which will be fully accepted by the business sphere of small and medium sized enterprises group. To secure sufficient extent of services in community and to support employment of residents is one of the main tasks of municipalities. Private businesses, mainly SME, look for comparative advantage by taking advantage of offered support in business in given communities and regions. The range of offered supports is limited and unevenly taken advantage of. Representatives of the small and medium-sized enterprises (owners or senior managers) were asked eight questions. Altogether was reached about 400 companies, of which 268 have indicated their willingness to fill out the presented questionnaire. The research confirmed that the SME entrepreneursnoticeably differ between offered supports. It was determined that the most used are the possibilities to contract smaller commissions to local contractors and using the favorable lease in the communal buildings. On the other hand, serviceability of some encouragements is not attractive enough for SME. For example, the help with promotion of business and its products or assistance services offering intermediation in collaboration with academic area while applying results V+V. Interesting outcome of questionnaire research was that contractors would welcome a better communication with the representatives of the municipalities. Part of the contractors are also unwilling to do business outside their place of residence. © 2017, Academy of Economic Studies from Bucharest. All rights reserved.

The Internet greatly increases firms' potential to produce new goods and service for new markets. The Internet is also having a dramatic impact on services, especially in the retail, trade and finance sectors, by enabling firms to digitize their products and deliver them over long distances. This paper considers how the Internet can increase exports by reducing trade costs, discusses how e-commerce is transforming sales to both domestic and foreign consumers, and considers how the Internet is making firms more mobile. Despite the enormous potential benefits, the use of the Internet to conduct digital trade is relatively limited in Europe and Central Asia (ECA). The paper focuses on the broad range of developing and developed countries in the ECA region, whose experience will have relevance for many countries. The policy priorities for governments are then reviewed, followed by the new challenges for policy.

This study investigates factors determining the location of foreign direct investments (FDI) in Sweden. The main purpose is to examine the link between FDI and public incentives, in the form of regional grants, which make up a central part of the Swedish regional policy and state expenditures that explicitly addresses regional development. Our main finding is that there is no evidence of a robust relationship between grants and the location of FDI. However, a statistically significant effect is found for investment support and transport allowance, which are grants that aims at promoting development in designated areas. This by supporting investments in machines, buildings, and so on, and offset costs disadvantages in the northern parts of the country. We conclude that a better integration between the work on FDI and regional development may be a plausible route to promote economic development in Sweden, particularly in deprived regions.

application/pdf, It is commonly recognized that rural economic development policies can be enhanced by localization or activity-complex economies． While such policies effectively work on the beginning，those are not sustainable as the national economic growth reaches at a mature stage． An attempt is made in this analysis to clarify missing elements of the long-run sustainable regional economic growth from the standpoint of industrial location analysis． An alternative model framework shows that a spatial policy adjustment needs to consider centripetal forces of populations in rural areas． This includes an establishment of either well-organized accessibility to the core area or self-sufficient regional economic system． Furthermore，roles played by sustainable rural economic growth for the enhancement of the long-run national economy are also explored to reveal these linkages．

It is well understood that the two most popular empirical models of location choice - conditional logit and Poisson - return identical coefficient estimates when the regressors are not individual specific. We show that these two models differ starkly in terms of their implied predictions. The conditional logit model represents a zero-sum world, in which one region's gain is the other regions' loss. In contrast, the Poisson model implies a positive-sum economy, in which one region's gain is no other region's loss. We also show that all intermediate cases can be represented as a nested logit model with a single outside option. The nested logit turns out to be a linear combination of the conditional logit and Poisson models. Conditional logit and Poisson elasticities mark the polar cases and can therefore serve as boundary values in applied research.

This study gives some insight into the relationships between the spatial environment, firm characteristics and long term existence of firms in the Netherlands. A logit model is employed to investigate the locational difference of firms, considering firm characteristics such as age, size, region and network. The main findings are that (long-term) continuation of the location and firm size are positively associated with long-term existence of firms.

The location-triangle framework, which was originally established by Alfred Weber, has been expanded in various ways and generalized as the Weber-Moses location-triangle model. However, several essential elements, in particular, regarding agglomeration economies have been excluded from the model framework. This may cause a potential difficulty to connect location-triangle approach with recent more advanced spatial economic analysis. In this paper, an alternative hypothetical model is introduced to the location triangle framework with the notions of agglomeration economies and corresponding transportation costs. The alternative model framework enables the location-triangle model to deal with investigating modern complex industrial organizations. Further avenues of extension are also discussed.

Jofre-Monseny J. and Sole-Olle A. Tax differentials in intraregional firm location: evidence from new manufacturing establishments in Spanish municipalities, Regional Studies. This paper analyses empirically how differences in local taxes affect the intraregional location of new manufacturing plants. These effects are examined within the random profit maximization framework. It looks at the location decision of more than 10 000 manufacturing establishments locating between 1996 and 2003 across more than 400 municipalities in Catalonia, a Spanish region. It is found that local taxes on business and property deter new manufacturing establishments. It is necessary to restrict the choice set to the local labour market and, above all, to control for agglomeration economies to identify the effects of taxes on the location of new establishments. Jofre-Monseny J. et Sole-Olle A. Les ecarts dans les taux d'imposition et la localisation intra-regionale des entreprises: des preuves provenant des nouveaux etablisseme...

This study aims to shed light on the effect of a firm’s geographic location on its voluntary disclosure policy. It hypothesizes that a firm’s geographic distance from metropolitan areas increases the cost of oversight of managerial actions, which creates incentives for remotely located firms to make more voluntary disclosures in their annual reports that improve information available to investors and hence mitigate agency conflicts. Based on a sample of 260 French listed firms spanning the period 2007 to 2010, we find support for our hypothesis that as a firm’s distance from the Paris region increases, its level of voluntary disclosure in annual reports increases as well. This is consistent with the notion that remote firms are likely to pre-commit to higher voluntary disclosure so as to reduce oversight costs arising from geographic remoteness and mitigate agency conflicts. Our results are robust to alternative measures of voluntary disclosure, to several geographic location proxies, and to alternative estimation techniques. Collectively, they confirm the positive effect of distance on the extent of voluntary disclosure.

This paper uses a comprehensive, official firm-level dataset for German manufacturing firms to investigate the location decision of new firm activity in the German regional economy, differentiated by firm structure. The rich regional dimension of this dataset is investigated for the first time in regard to the location choices of firms. Results reveal that agglomeration economies play a significant role for small firms, but not for medium-sized and large firms. Whereas the market potential exerts a significant positive impact for all firms, labor costs do not exert a significant impact on large firms' location decisions.

This paper is based on the PhD thesis written by the author. Post-fordist production system has raised since 1970's. Main firms have divided production process into different stages and transferred some stages of the production to either other firms in the same factory or another firms in another spaces. Not only production process but also different parts of supply chain have been moved to different geographies. Apparel industry in Turkey has faced with similar development. Large apparel producers have moved some part of their production to the different locations in both Turkey and abroad. The aim of the paper is to investigate which parts of the supply chain of Turkish apparel industry have moved to different geographies and which of those have stayed where it is established. Moreover, it is searched the location and relocation criteria of these firms. A case study has conducted for the research. Eroglu Giyim, one of the biggest apparel supplier of Turkey and owner of very well-known brand of Colin's, and its supply chain have been investigated. Semi-structured deep interviews have been made with Eroglu Giyim, its subcontractors and its input suppliers. Supply and production maps of Eroglu Giyim for the year of 2002 and 2012 have been produced. 27 suppliers of total 35 suppliers have been interviewed to find out their location and re-location criteria. Eroglu Giyim has expanded its production network globally since 2003. The main reasons of this expanding are flexible and international production system, expectations and demands of their customers, legal and trade regulations as well as qualifications and strategies of the firm. Which products to be produced in which geography has been determined by customer demands and expectations. Those are related to some advantages of geography, for example, accessibility, human capital, innovation, proximity and face-to-face contact. Geography of the input supplier of Eroglu Giyim has been mainly shaped by strategies and qualifications of the firm and its suppliers. Legal regulations, which are made by the state in order to restrict the import, causes input to supply from generally Turkey. However, some input are purchased from the foreign international suppliers that make production in Turkey. All these local and international suppliers have mainly concentrated on Marmara Region where Istanbul in. It has observed that Turkish fabric companies have expanded their marketing networks globally for last 10 years. Most of them have a contact office in numerous countries in different continents, especially in Europe. Some of these companies have started to make production abroad. It has been seen obviously in the survey that Turkish fabric suppliers have become international companies for more than 10 years. Geographical proximity still is a very important location criteria for producer firms, suppliers and main customers. Istanbul presents some advantages like transportation, proximity to market, skilled labour force and face-to-face contact for the firms. Especially skilled labour force of Istanbul causes more complicated goods to produce in this city. So, Istanbul still is an important city for the apparel firms although its disadvantages like expensive production cost.

We compare the industrial dynamics in the core, semi-periphery and periphery in the Netherlands in terms of firm entry-exit, size, growth and location patterns. The contribution of our work is to provide the first comprehensive study on spatial differentiation in industrial dynamics for all firm sizes and all sectors, including services. We find that location patterns are largely consistent with the spatial product lifecycle model: traditional Fordist sectors are over-represented in the periphery, while sectors associated with the ICT paradigm are over-represented in the core, with the notable exception of science-based manufacturing. Second, where the industrial dynamics in manufacturing sectors follow the predicted patterns, the industrial dynamics in service sectors largely contradict product lifecycle theory. We conclude that the spatial product lifecycle theory applies well to traditional manufacturing, while more specific theories are required to understand the location and industrial dynamics of science-based industries and service industries.

We compare the industrial dynamics in the core, semi-periphery and periphery in the Netherlands in terms of firm entry-exit, size, growth and location patterns. The contribution of our work is to provide the first comprehensive study on spatial differentiation in industrial dynamics for all firm sizes and all sectors, including services. We find that location patterns are largely consistent with the spatial product lifecycle model: traditional Fordist sectors are over-represented in the periphery, while sectors associated with the ICT paradigm are over-represented in the core, with the notable exception of science-based manufacturing. Second, where the industrial dynamics in manufacturing sectors follow the predicted patterns, the industrial dynamics in service sectors largely contradict product lifecycle theory. We conclude that the spatial product lifecycle theory applies well to traditional manufacturing, while more specific theories are required to understand the location and industrial dynamics of science-based industries and service industries.

This paper uses a Poisson regression model to estimate the determinants of firm relocation from urban areas to rural areas between 2009 and 2012, including controls for land and labor costs, taxes, market size, agglomeration effects, natural amenities, but with a focus on measures of school quality. To the best of our knowledge, this is the first study of firm relocation between rural and urban areas within the United States and the only study to estimate the impacts of school quality on firm relocation behavior. Preliminary results from these models suggest that lower high school dropout rates and smaller class sizes may increase the expected count of firms relocating from urban to rural areas.

Présenté par Sonia Paty

International audience

Location decisions are often based on inaccurate information about potential locations. Decision-makers seem to be guided by their subjective interpretation of reality, not so much by reality itself. Twenty years ago this fundamental idea was the starting point for a research programme of the Faculty of Spatial Sciences of the University of Groningen, focused on the subjective rating of locations by Dutch entrepreneurs. Three extensive and identical postal enquiries were held, in 1983, 1993 and 2003. On this basis a comparison can now be made of the changing 'mental map' of Dutch entrepreneurs during those twenty years. The paper analyses the three maps, preceded by a short introduction about the behavioural approach in economic geography, which inspired the research project. The survey data are used in a factor analysis, to establish the basic influences that form the entrepreneurial mental maps. The basic dome shape of the maps did not change much. During 1983 to 1993 we witness a decrease of appreciation of locations on its West flank (the 'old' Randstad) while in 1993 to 2003 this decrease extends to the Eastern Randstad. Factor analysis suggests that three fundamental dimensions determine entrepreneurs' judgments: potency, activity and evaluation. Potency may be understood as centrality of location. Activity is correlated to agglomeration. It is hypothesised that landscape and culture determine the evaluative dimension.

This paper investigates the impact of monopsony power on the location decision of the firm. It shows that if the transportation rates are a function of distance only and the production function is homogeneous of degree one, the optimum location is independent of monopsony power. However, if the transportation rates are a function of quantity shipped and distance traveled, a homogeneous production of degree one does not ensure independence between the optimum location and monopsony power. This result is significantly different from the well-known Mai-Suwanakul-Yeh proposition in the constant transportation case.