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Spatial organization of firms

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  • Yukako Ono

Abstract

A firm’s production activities are often supported by non-production activities. Among these activities are administrative units including headquarters, which process information both within and between firms. Often firms physically separate such administrative units from their production activities and create stand alone Central Administrative Offices (CAO). However, having its activities in multiple locations potentially imposes significant internal firm face-to-face communication costs. What types of firms are more likely to separate out such functions? If firms do separate administration and production, where do they place CAOs and why? How often do firms open and close, or relocate CAOs? This paper documents such firms’ decisions on their spatial organization by using micro-level data from the U.S. Census Bureau.

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Bibliographic Info

Paper provided by Federal Reserve Bank of Chicago in its series Working Paper Series with number WP-03-30.

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Date of creation: 2003
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Handle: RePEc:fip:fedhwp:wp-03-30

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Keywords: Industrial organization (Economic theory);

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  1. Duranton, Gilles & Puga, Diego, 2005. "From sectoral to functional urban specialisation," Journal of Urban Economics, Elsevier, vol. 57(2), pages 343-370, March.
  2. Aghion, Philippe & Tirole, Jean, 1997. "Formal and Real Authority in Organizations," Journal of Political Economy, University of Chicago Press, vol. 105(1), pages 1-29, February.
  3. Timothy Dunne & Mark J. Roberts & Larry Samuelson, 1988. "Patterns of Firm Entry and Exit in U.S. Manufacturing Industries," RAND Journal of Economics, The RAND Corporation, vol. 19(4), pages 495-515, Winter.
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Cited by:
  1. J. Vernon Henderson, 2005. "Commentary on "Urban colossus: why is New York America's largest city?"," Economic Policy Review, Federal Reserve Bank of New York, issue Dec, pages 25-27.
  2. Frank Tannery & Paul Laurent, 2007. "Les groupes à la croisée des territoires : géostratégie de l’innovation," Revue Finance Contrôle Stratégie, revues.org, vol. 10(4), pages 179-214, December.

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