Advanced Search
MyIDEAS: Login

Mobility of Corporate Headquarter Functions: A Literature Review

Contents:

Author Info

  • Deschryvere, Matthias
Registered author(s):

    Abstract

    This paper reviews the recent literature on the relocation of headquarters (HQs). Overall results show that full and direct international relocations of corporate HQs are rare events. However, there is a trend that MNEs increasingly unbundle their HQs so as to spread their different HQs functions over several locations around the world. The literature on the organisation of companies shows that HQ unbundling can go hand in hand with different patterns of HQ relocations. The international trade literature underlines that falling communication costs enable firms to offshore HQ-tasks that were previously considered non-traded. International competition occurs now between individual workers performing similar HQ-tasks in different nations. The new economic geography literature explains the spatial concentration of HQs functions by the existence of agglomeration effects. Most empirical literature focuses on relocations within the United States. Relocations within the EU are less frequent which may be explained by legal and cultural barriers. An important finding is that many HQ relocations result from a merger or acquisition, but institutional factors, such as international tax incentives and labour market institutions, were also identified as key drivers of HQ relocations. The effects of relocations on the company performance are relatively small although results seem to depend on the motivation behind the relocation. For nations, the unbundling of HQs implies that the competition between (potential) locations for HQ functions will rise. Pääkonttoritoimintojen liikkuvuus. Katsaus kirjallisuuteen

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.etla.fi/wp-content/uploads/2012/09/dp1203.pdf
    Download Restriction: no

    Bibliographic Info

    Paper provided by The Research Institute of the Finnish Economy in its series Discussion Papers with number 1203.

    as in new window
    Length: 31 pages
    Date of creation: 2009
    Date of revision:
    Handle: RePEc:rif:dpaper:1203

    Contact details of provider:
    Postal: Lönnrotinkatu 4 B, FIN-00120 HELSINKI
    Phone: +358 (0)9 609 900
    Fax: +358 (0)9 601 753
    Web page: http://www.etla.fi/
    More information through EDIRC

    Order Information:
    Email:

    Related research

    Keywords: internationalisation; corporate headquarters; divisional headquarters; corporate mobility; relocation; multinational corporations; taxation; FDI; foreign ownership;

    Find related papers by JEL classification:

    This paper has been announced in the following NEP Reports:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Richard Gregory & John R. Lombard & Bruce Seifert, 2005. "Impact of Headquarters Relocation on the Operating Performance of the Firm," Economic Development Quarterly, , vol. 19(3), pages 260-270, August.
    2. Peter Egger, 2009. "Taxation and the Globalisation Process: Editorial Introduction," The World Economy, Wiley Blackwell, vol. 32(9), pages 1269-1270, 09.
    3. Aleid E. Brouwer & Ilaria Mariotti & Jos N. van Ommeren, 2004. "The firm relocation decision: An empirical investigation," The Annals of Regional Science, Springer, vol. 38(2), pages 335-347, 06.
    4. Gilles Duranton & Diego Puga, 2001. "From sectoral to functional urban specialisation," LSE Research Online Documents on Economics 20101, London School of Economics and Political Science, LSE Library.
    5. Salvador Barrios & Harry Huizinga & Luc Laeven & Gaëtan J.A. Nicodème, 2008. "International Taxation and Multinational Firm Location Decisions," CESifo Working Paper Series 2503, CESifo Group Munich.
    6. Henderson, J. Vernon & Ono, Yukako, 2008. "Where do manufacturing firms locate their headquarters?," Journal of Urban Economics, Elsevier, vol. 63(2), pages 431-450, March.
    7. Gene M. Grossman & Esteban Rossi-Hansberg, 2006. "Trading Tasks: A Simple Theory of Offshoring," NBER Working Papers 12721, National Bureau of Economic Research, Inc.
    8. Germà Bel & Xavier Fageda, 2005. "Getting there fast: Globalization, intercontinental flights and location of headquarters," Urban/Regional 0511008, EconWPA.
    9. Davis, James C. & Henderson, J. Vernon, 2008. "The agglomeration of headquarters," Regional Science and Urban Economics, Elsevier, vol. 38(5), pages 445-460, September.
    10. Kristin Aarland & James Davis & J Vernon Henderson & Yukako Ono, 2004. "Spatial Organization of Firms: The Decision to Split Production and Administration," Working Papers 04-03, Center for Economic Studies, U.S. Census Bureau.
    11. Baaij, Marc & Van Den Bosch, Frans & Volberda, Henk, 2004. "The International Relocation of Corporate Centres:: Are Corporate Centres Sticky?," European Management Journal, Elsevier, vol. 22(2), pages 141-149, April.
    12. Leo Sleuwaegen & Enrico Pennings, 2006. "International Relocation Of Production: Where Do Firms Go?," Scottish Journal of Political Economy, Scottish Economic Society, vol. 53(4), pages 430-446, 09.
    13. de Mooij, Ruud A & Ederveen, Sjef, 2003. "Taxation and Foreign Direct Investment: A Synthesis of Empirical Research," International Tax and Public Finance, Springer, vol. 10(6), pages 673-93, November.
    14. Ghosh Chinmoy & Rodriguez Mauricio & Sirmans C. F., 1995. "Gains from Corporate Headquarters Relocations: Evidence from the Stock Market," Journal of Urban Economics, Elsevier, vol. 38(3), pages 291-311, November.
    15. Christo Pirinsky & Qinghai Wang, 2006. "Does Corporate Headquarters Location Matter for Stock Returns?," Journal of Finance, American Finance Association, vol. 61(4), pages 1991-2015, 08.
    16. Diego Puga, 1996. "The Spread of Industry: Spatial Agglomeration in Economic Development," CEP Discussion Papers dp0279, Centre for Economic Performance, LSE.
    17. Kasim L. Alli & Gabriel G. Ramirez & Kenneth Yung, 1991. "Corporate Headquarters Relocation: Evidence from the Capital Markets," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 19(4), pages 583-600.
    18. Head, Charles Keith & Mayer, Thierry, 2002. "Market Potential and the Location of Japanese Investment in the European Union," CEPR Discussion Papers 3455, C.E.P.R. Discussion Papers.
    19. Katariina Nilsson Hakkala & Fredrik Heyman & Fredrik Sjöholm, 2009. "Multinational firms and job tasks," Working Papers 8, Government Institute for Economic Research Finland (VATT).
    20. Strauss-Kahn, Vanessa & Vives, Xavier, 2006. "Why and where do headquarters move?," IESE Research Papers D/650, IESE Business School.
    21. Thomas Klier & William Testa, 2002. "Location trends of large company headquarters during the 1990s," Economic Perspectives, Federal Reserve Bank of Chicago, issue Q II, pages 12-26.
    22. Yukako Ono, 2002. "Outsourcing business services and the role of central administrative offices," Working Paper Series WP-02-01, Federal Reserve Bank of Chicago.
    23. Desai, Mihir A. & Hines, James R. Jr., 2002. "Expectations and Expatriations: Tracing the Causes and Consequences of Corporate Inversions," National Tax Journal, National Tax Association, vol. 55(3), pages 409-40, September.
    24. René Belderbos, 1997. "Antidumping and tariff Jumping: Japanese firms’ DFI in the European union and the United States," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 133(3), pages 419-457, September.
    25. Birkinshaw, Julian & Braunerhjelm, Pontus & Holm, Ulf & Terjesen, Siri, 2006. "Why Do Some Multinational Corporations Relocate Their Headquarters Overseas?," Working Paper Series in Economics and Institutions of Innovation 54, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
    26. Martha A. O’Mara, 1999. "Strategic Drivers of Location Decisions for Information-Age Companies," Journal of Real Estate Research, American Real Estate Society, vol. 17(3), pages 365-386.
    27. Huizinga, Harry & Voget, Johannes, 2006. "International Taxation and the Direction and Volume of Cross-Border M&As," CEPR Discussion Papers 5974, C.E.P.R. Discussion Papers.
    28. Chan, Su Han & Gau, George W. & Wang, Ko, 1995. "Stock Market Reaction to Capital Investment Decisions: Evidence from Business Relocations," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 30(01), pages 81-100, March.
    29. Pennings, Enrico & Sleuwaegen, Leo, 2000. "International relocation: firm and industry determinants," Economics Letters, Elsevier, vol. 67(2), pages 179-186, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:rif:dpaper:1203. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Kaija Hyvönen-Rajecki).

    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 references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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