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Where do manufacturing firms locate their headquarters?

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  • Henderson, J. Vernon
  • Ono, Yukako

Abstract

Firms often separate headquarters' (HQ) functions physically from their production facilities and construct stand-alone HQs. By locating its HQ in a large, service oriented metro area away from its production facilities, a firm may be better able to outsource service functions in that local metro market and also to gather information about market conditions for their products. However if the firm locates the HQ away from its production activity, the coordination costs in managing plant activities are increased. In this paper, we empirically analyze the trade-off between these two considerations.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Urban Economics.

Volume (Year): 63 (2008)
Issue (Month): 2 (March)
Pages: 431-450

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Handle: RePEc:eee:juecon:v:63:y:2008:i:2:p:431-450

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Web page: http://www.elsevier.com/locate/inca/622905

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Keywords: Headquarters Coordination Location decision Manufacturing;

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  1. Patrick Bayer & Robert McMillan & Kim Rueben, 2005. "Residential Segregation in General Equilibrium," NBER Working Papers 11095, National Bureau of Economic Research, Inc.
  2. Stuart S. Rosenthal & William C. Strange, 2003. "Geography, Industrial Organization, and Agglomeration," Center for Policy Research Working Papers 56, Center for Policy Research, Maxwell School, Syracuse University.
  3. Steven T. Berry, 1994. "Estimating Discrete-Choice Models of Product Differentiation," RAND Journal of Economics, The RAND Corporation, vol. 25(2), pages 242-262, Summer.
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