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Modeling industrial location decisions in U.S. counties

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  • Octavio Figueiredo

    ()
    (University of Porto, CEMPRE)

  • Paulo Guimaraes

    ()
    (NIMA, Universidade do Minho)

  • Douglas Woodward

    ()
    (University of South Carolina)

Abstract

Given its sound theoretical underpinnings, the RandomUtilityMaximizationbased conditional logit model (CLM) serves as the principal method for applied research on industrial location decisions. Studies that implemented this methodology, however, had to confront the underlying Independence of Irrelevant Alternatives (IIA) assumption and were unable to fully accommodate this problem. This paper shows that by taking advantage of an equivalent relation between the CLM and Poisson regression likelihood functions one can more e.ectively control for the potential IIA violation in complex choice scenarios where the decision-maker confronts a large number of spatial alternatives. The paper also provides an illustration, demonstrating the advantages of this relation in investigation of location determinants of new manufacturing plant births in the U.S. counties.

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Bibliographic Info

Paper provided by Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho in its series NIMA Working Papers with number 18.

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Length: 36 pages
Date of creation: Apr 2002
Date of revision:
Handle: RePEc:nim:nimawp:18/2002

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Cited by:
  1. Ligia Costa Pinto & Glenn Harrison, 2000. "Multilateral negotiations over climate change policy," NIMA Working Papers, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho 1, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  2. Joao Cerejeira da Silva, 2002. "Identification of the Portuguese industrial districts," NIMA Working Papers, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho 17, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  3. Aslan Zorlu & Joop Hartog, 2002. "The effect of immigration on wages in three European countries," NIMA Working Papers, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho 19, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  4. Anabela Botelho, 2001. "Strategic behavior at trial-The production, reporting, and evaluation of complex evidence," NIMA Working Papers, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho 14, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  5. Botelho, Anabela & Pinto, Ligia Costa, 2004. "Students' expectations of the economic returns to college education: results of a controlled experiment," Economics of Education Review, Elsevier, vol. 23(6), pages 645-653, December.
  6. Cardoso, Ana Rute & Ferreira, Priscila, 2002. "The Dynamics of Job Creation and Destruction for University Graduates: Why a Rising Unemployment Rate Can Be Misleading," IZA Discussion Papers 623, Institute for the Study of Labor (IZA).
  7. Pedro Portugal & Ana Rute Cardoso, 2001. "Disentangling the minimum wage puzzle: an analysis of job accessions and separations from a longitudinal matched employer- employee data set," NIMA Working Papers, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho 9, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  8. Pe'er, Aviad & Vertinsky, Ilan, 2008. "Firm exits as a determinant of new entry: Is there evidence of local creative destruction?," Journal of Business Venturing, Elsevier, vol. 23(3), pages 280-306, May.
  9. Anabela Botelho & Ligia Costa Pinto, 2001. "Hypothetical, real, and predicted real willingness to pay in open-ended surveys: experimental results," NIMA Working Papers, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho 12, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  10. Anabela Botelho & Ligia Costa Pinto & Miguel Portela & Antonio Silva, 2001. "The determinants of success in university entrance," NIMA Working Papers, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho 13, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  11. Elvira Lima & David K. Whynes, 2003. "Finance and performance of Portuguese hospitals," NIMA Working Papers, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho 20, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  12. Frances Ruane & Xiaoheng Zhang, 2007. "Location Choices of the Pharmaceutical Industry in Europe after 1992," The Institute for International Integration Studies Discussion Paper Series iiisdp220, IIIS.
  13. Paulo Guimaraes, 2001. "The state of Portuguese research in economics: an anlysis based on publications in international journals," NIMA Working Papers, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho 15, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  14. Elvira Lima & Teresa J. Esquerdo, 2003. "The economic costs of alcohol misuse in Portugal," NIMA Working Papers, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho 24, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  15. Elisabet Viladecans Marsal & Josep Maria Arauzo Carod, . "Industrial Location at the Intra-metropolitan Level: A Negative Binomial Approach," Studies on the Spanish Economy 224, FEDEA.
  16. Siedschlag, Iulia & Zhang, Xiaoheng & Smith, Donal, 2009. "What Determines the Attractiveness of EU Regions to the Location of Multinational Firms in the ICT Sector?," Papers, Economic and Social Research Institute (ESRI) DYNREG45, Economic and Social Research Institute (ESRI).

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