IDEAS home Printed from https://ideas.repec.org/a/eee/jotrge/v91y2021ics0966692321000089.html
   My bibliography  Save this article

Understanding business location decision making for transport planning: An investigation of the role of process rules in identifying influences on firm location

Author

Listed:
  • Balbontin, Camila
  • Hensher, David A.

Abstract

Decisions made by businesses on where to locate or relocate are typically given less consideration in integrated transport and land use modelling systems than residential location. This is surprising given the important role that businesses play in defining employment opportunities, and hence the travel patterns of workers and any travel associated with accessing firms. This paper studies business location decisions in the Greater Sydney Metropolitan Area (GSMA) through two types of models. The first one, referred to as an attribute-non-attendance (ANA) model, is used to identify the influences on location decisions that are attended to and those that are typically ignored. The second model is a mixed multinomial logit model with ANA to capture differences in preferences as a way of investigating the key drivers of business location. The findings suggest that the main drivers vary across the GSMA, making specific locations an important determinant of choice, with businesses located in Sydney being especially concerned about access to public transport and the distance of other locations to the current location; businesses located in Wollongong placing great importance on client accessibility; and businesses located in Newcastle being very sensitive to the distance to their current location. Simulated scenarios are presented in this study to illustrate the degree of behavioural responsiveness to changes in important attributes such as accessibility, location and office characteristics.

Suggested Citation

  • Balbontin, Camila & Hensher, David A., 2021. "Understanding business location decision making for transport planning: An investigation of the role of process rules in identifying influences on firm location," Journal of Transport Geography, Elsevier, vol. 91(C).
    • Handle: RePEc:eee:jotrge:v:91:y:2021:i:c:s0966692321000089
    DOI: 10.1016/j.jtrangeo.2021.102955
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0966692321000089
    Download Restriction: no
    File URL: https://libkey.io/10.1016/j.jtrangeo.2021.102955?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Paulo Guimarães & Octávio Figueirdo & Douglas Woodward, 2003. "A Tractable Approach to the Firm Location Decision Problem," The Review of Economics and Statistics, MIT Press, vol. 85(1), pages 201-204, February.
    2. Mariel, Petr & Hoyos, D. & Meyerhoff, J., 2013. "Stated or inferred attribute non-attendance? A simulation approach," Economia Agraria y Recursos Naturales, Spanish Association of Agricultural Economists, vol. 13(01).
    3. repec:dgr:rugsom:02d31 is not listed on IDEAS
    4. Hensher, David A. & Rose, John & Bertoia, Tony, 2007. "The implications on willingness to pay of a stochastic treatment of attribute processing in stated choice studies," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 43(2), pages 73-89, March.
    5. Balbontin, Camila & Hensher, David A., 2020. "Identifying the role of stated process strategies in business location decisions," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 141(C).
    6. Balz R. Bodenmann & Kay W. Axhausen, 2012. "Destination choice for relocating firms: A discrete choice model for the St. Gallen region, Switzerland," Papers in Regional Science, Wiley Blackwell, vol. 91(2), pages 319-341, June.
    7. Hess, Stephane & Hensher, David A., 2010. "Using conditioning on observed choices to retrieve individual-specific attribute processing strategies," Transportation Research Part B: Methodological, Elsevier, vol. 44(6), pages 781-790, July.
    8. Hensher,David A. & Rose,John M. & Greene,William H., 2015. "Applied Choice Analysis," Cambridge Books, Cambridge University Press, number 9781107465923.
    9. Mikaela Backman & Charlie Karlsson, 2017. "Location of New Firms: Influence of Commuting Behaviour," Growth and Change, Wiley Blackwell, vol. 48(4), pages 682-699, December.
    10. de Bok, Michael & van Oort, Frank, 2011. "Agglomeration economies, accessibility, and the spatial choice behavior of relocating firms," The Journal of Transport and Land Use, Center for Transportation Studies, University of Minnesota, vol. 4(1), pages 5-24.
    11. Riccardo Scarpa & Raffaele Zanoli & Viola Bruschi & Simona Naspetti, 2013. "Inferred and Stated Attribute Non-attendance in Food Choice Experiments," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 95(1), pages 165-180.
    12. Jouke van Dijk & Piet H. Pellenbarg, 2000. "Firm relocation decisions in The Netherlands: An ordered logit approach," Papers in Regional Science, Springer;Regional Science Association International, vol. 79(2), pages 191-219.
    13. Weller, Priska & Oehlmann, Malte & Mariel, Petr & Meyerhoff, Jürgen, 2014. "Stated and inferred attribute non-attendance in a design of designs approach," Journal of choice modelling, Elsevier, vol. 11(C), pages 43-56.
    14. David Hensher & John Rose & William Greene, 2005. "The implications on willingness to pay of respondents ignoring specific attributes," Transportation, Springer, vol. 32(3), pages 203-222, May.
    15. Aleid E. Brouwer & Ilaria Mariotti & Jos N. van Ommeren, 2004. "The firm relocation decision: An empirical investigation," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 38(2), pages 335-347, June.
    16. Anet Weterings & Joris Knoben, 2013. "Footloose: An analysis of the drivers of firm relocations over different distances," Papers in Regional Science, Wiley Blackwell, vol. 92(4), pages 791-809, November.
    17. David A. Hensher, 2006. "How do respondents process stated choice experiments? Attribute consideration under varying information load," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 21(6), pages 861-878.
    18. Willigers, Jasper & van Wee, Bert, 2011. "High-speed rail and office location choices. A stated choice experiment for the Netherlands," Journal of Transport Geography, Elsevier, vol. 19(4), pages 745-754.
    19. Puckett, Sean M. & Hensher, David A., 2008. "The role of attribute processing strategies in estimating the preferences of road freight stakeholders," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 44(3), pages 379-395, May.
    20. Boris Portnov & Moshe Schwartz, 2008. "On the Relativity of Urban Location," Regional Studies, Taylor & Francis Journals, vol. 42(4), pages 605-615.
    21. 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, February.
    22. Pellenbarg, P.H. & Wissen, L.J.G. van & Dijk, J. van, 2002. "Firm relocation: state of the art and research prospects," Research Report 02D31, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    23. Shelley M. Kimelberg & Elizabeth Williams, 2013. "Evaluating the Importance of Business Location Factors: The Influence of Facility Type," Growth and Change, Wiley Blackwell, vol. 44(1), pages 92-117, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Espinosa-Goded, María & Rodriguez-Entrena, Macario & Salazar-Ordóñez, Melania, 2021. "A straightforward diagnostic tool to identify attribute non-attendance in discrete choice experiments," Economic Analysis and Policy, Elsevier, vol. 71(C), pages 211-226.
    2. Samani, Ali Riahi & Mishra, Sabyasachee & Golias, Mihalis & Lee, David J.-H., 2023. "What influences the location choice of establishments? An analysis considering establishment types and activities interactions," Journal of Transport Geography, Elsevier, vol. 111(C).
    3. Henke, Ilaria & Moyano, Amparo & Pagliara, Francesca, 2023. "Influence of high-speed rail on the decentralisation of events from big metropolitan areas to smaller intermediate cities," Socio-Economic Planning Sciences, Elsevier, vol. 85(C).
    4. Ahmed, Usman & Hawkins, Jason & Roorda, Matthew J., 2022. "Establishment location choice model considering intra-firm interactions," Journal of Transport Geography, Elsevier, vol. 102(C).
    5. Xintao Li & Xue’er Xu & Diyi Liu & Mengqiao Han & Siqi Li, 2022. "Consumers’ Willingness to Pay for the Solar Photovoltaic System in the Post-Subsidy Era: A Comparative Analysis under an Urban-Rural Divide," Energies, MDPI, vol. 15(23), pages 1-22, November.
    6. Adam Sulich & Malgorzata Rutkowska & Uma Shankar Singh, 2021. "Decision Towards Green Careers and Sustainable Development," Papers 2106.00465, arXiv.org.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Samani, Ali Riahi & Mishra, Sabyasachee & Golias, Mihalis & Lee, David J.-H., 2023. "What influences the location choice of establishments? An analysis considering establishment types and activities interactions," Journal of Transport Geography, Elsevier, vol. 111(C).
    2. Gonçalves, Tânia & Lourenço-Gomes, Lina & Pinto, Lígia M. Costa, 2022. "The role of attribute non-attendance on consumer decision-making: Theoretical insights and empirical evidence," Economic Analysis and Policy, Elsevier, vol. 76(C), pages 788-805.
    3. Balbontin, Camila & Hensher, David A., 2020. "Identifying the role of stated process strategies in business location decisions," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 141(C).
    4. Caputo, Vincenzina & Loo, Ellen J. Van & Scarpa, Riccardo & Nayga, Rodolfo M. Jr & Verbeke, Wim, 2014. "“Using Experiments to Address Attribute Non-attendance in Consumer Food Choices”," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 177173, Agricultural and Applied Economics Association.
    5. Sandra Notaro & Maria De Salvo & Roberta Raffaelli, 2022. "Estimating Willingness to Pay for Alpine Pastures: A Discrete Choice Experiment Accounting for Attribute Non-Attendance," Sustainability, MDPI, vol. 14(7), pages 1-15, March.
    6. Biyue Lin & Shoukat Iqbal Khattak & Bei Zhao, 2021. "To Relocate Or Not to Relocate: A Logit Regression Model of Factors Influencing Corporate Headquarter Relocation Decision in China," SAGE Open, , vol. 11(3), pages 21582440211, July.
    7. Mohammed Alemu & Morten Mørkbak & Søren Olsen & Carsten Jensen, 2013. "Attending to the Reasons for Attribute Non-attendance in Choice Experiments," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 54(3), pages 333-359, March.
    8. Mara Thiene & Riccardo Scarpa & Jordan Louviere, 2015. "Addressing Preference Heterogeneity, Multiple Scales and Attribute Attendance with a Correlated Finite Mixing Model of Tap Water Choice," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 62(3), pages 637-656, November.
    9. Yegoryan, Narine & Guhl, Daniel & Klapper, Daniel, 2018. "Inferring Attribute Non-Attendance Using Eye Tracking in Choice-Based Conjoint Analysis," Rationality and Competition Discussion Paper Series 111, CRC TRR 190 Rationality and Competition.
    10. Kemper, Nathan & Popp, Jennie & Nayga, Jr., Rodolfo M. & Bazzani, Claudia, 2024. "A Query Approach to Modeling Attendance to Attributes in Discrete Choice Experiments," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 0(Preprint), January.
    11. David Hensher & John Rose & William Greene, 2012. "Inferring attribute non-attendance from stated choice data: implications for willingness to pay estimates and a warning for stated choice experiment design," Transportation, Springer, vol. 39(2), pages 235-245, March.
    12. Ariane Kehlbacher & Kelvin Balcombe & Richard Bennett, 2013. "Stated Attribute Non-attendance in Successive Choice Experiments," Journal of Agricultural Economics, Wiley Blackwell, vol. 64(3), pages 693-706, September.
    13. Espinosa-Goded, María & Rodriguez-Entrena, Macario & Salazar-Ordóñez, Melania, 2021. "A straightforward diagnostic tool to identify attribute non-attendance in discrete choice experiments," Economic Analysis and Policy, Elsevier, vol. 71(C), pages 211-226.
    14. Federica Rossi & Magdalena Dej, 2020. "Where do firms relocate? Location optimisation within and between Polish metropolitan areas," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 64(3), pages 615-640, June.
    15. Ortega, David L. & Ward, Patrick S. & Caputo, Vincenzina, 2019. "Evaluating producer preferences and information processing strategies for drought risk management tools in Bangladesh," World Development Perspectives, Elsevier, vol. 15(C), pages 1-1.
    16. David Hensher, 2014. "Attribute processing as a behavioural strategy in choice making," Chapters, in: Stephane Hess & Andrew Daly (ed.), Handbook of Choice Modelling, chapter 12, pages 268-289, Edward Elgar Publishing.
    17. Weller, Priska & Oehlmann, Malte & Mariel, Petr & Meyerhoff, Jürgen, 2014. "Stated and inferred attribute non-attendance in a design of designs approach," Journal of choice modelling, Elsevier, vol. 11(C), pages 43-56.
    18. Chen, Xuqi & Shen, Meng & Gao, Zhifeng, 2017. "Impact of Intra-respondent Variations in Attribute Attendance on Consumer Preference in Food Choice," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258509, Agricultural and Applied Economics Association.
    19. Miguel C. Manjon-Antolin & Josep Maria Arauzo-Carod, 2006. "Locations and Relocations: Modelling, Determinants, and Interrelations," ERSA conference papers ersa06p33, European Regional Science Association.
    20. David Hensher & Andrew Collins & William Greene, 2013. "Accounting for attribute non-attendance and common-metric aggregation in a probabilistic decision process mixed multinomial logit model: a warning on potential confounding," Transportation, Springer, vol. 40(5), pages 1003-1020, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jotrge:v:91:y:2021:i:c:s0966692321000089. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/journal-of-transport-geography .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.