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Exploring Firm Location Beyond Simple Growth Models: A Double Hurdle Application

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  • Davis Reum, Alison
  • Harris, Thomas R.
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    Abstract

    Firm location decisions are typically influenced by economic, demographic, environmental, and social factors. This research extends the current literature by investigating the factors thought to influence the total number of manufacturing firms within a given region. Given the large number of regions without any manufacturing firms, a double hurdle model is employed to account for excess zeros. The results suggest that there are certain industry input variables, such as population and education that make a region an attractive or unattractive location for a particular manufacturing firm.

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    File URL: http://purl.umn.edu/132313
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    Bibliographic Info

    Article provided by Mid-Continent Regional Science Association in its journal Journal of Regional Analysis and Policy.

    Volume (Year): 36 (2006)
    Issue (Month): 1 ()
    Pages:

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    Handle: RePEc:ags:jrapmc:132313

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    Web page: http://jrap-journal.org/index.htm
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    Keywords: Production Economics;

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    1. Paulo Guimaraes & Octávio Figueiredo & Douglas Woodward, 2004. "Industrial Location Modeling: Extending the Random Utility Framework," Journal of Regional Science, Wiley Blackwell, vol. 44(1), pages 1-20.
    2. Bartik, Timothy J, 1985. "Business Location Decisions in the United States: Estimates of the Effects of Unionization, Taxes, and Other Characteristics of States," Journal of Business & Economic Statistics, American Statistical Association, vol. 3(1), pages 14-22, January.
    3. John C. Leatherman & Donald J. Howard & Terry L. Kastens, 2002. "Improved Prospects for Rural Development: An Industrial Targeting System for the Great Plains," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 24(1), pages 59-77.
    4. Thomas J. Holmes, 1998. "The Effect of State Policies on the Location of Manufacturing: Evidence from State Borders," Journal of Political Economy, University of Chicago Press, vol. 106(4), pages 667-705, August.
    5. Todd M. Gabe & Kathleen P. Bell, 2004. "Tradeoffs between Local Taxes and Government Spending as Determinants of Business Location," Journal of Regional Science, Wiley Blackwell, vol. 44(1), pages 21-41.
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