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Business relocations in the Netherlands: Why do firms move, and where do they go?

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  • Kristin Kronenberg

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Abstract

This study analyzes determinants of business relocation and identifies regional characteristics which attract relocating firms, using register data provided by Statistics Netherlands. Results indicate that the relocation decisions of firms are not only influenced by firm- and location-specific characteristics, but also by the qualities of a firm’s workforce, and by the attractiveness of a municipality for individuals regarding the amenities which are provided. Furthermore, the findings show that relocation decisions are sector-dependent. Generally, its age and being located in an appealing municipality with high sectoral specialization keep a firm from relocating, whereas firms employing large shares of highly educated workers, paying high average salaries and being located in a municipality with high sector-specific wages are pushed out of their present location. Relocating firms avoid specialized municipalities, while they are attracted by densely populated, appealing municipalities with high wage levels (both general and sector-specific) and large shares of highly educated workers, and which are specialized in the firm’s own sector.

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Bibliographic Info

Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa11p1450.

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Date of creation: Sep 2011
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Handle: RePEc:wiw:wiwrsa:ersa11p1450

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  1. Kronenberg, Kristin & Carree, Martin, 2010. "Job and residential mobility in the Netherlands: the influence of human capital, household composition and location," MPRA Paper 25840, University Library of Munich, Germany.
  2. Adelheid Holl, 2004. "Start-ups and relocations: Manufacturing plant location in Portugal," Economics of Governance, Springer, vol. 83(4), pages 649-668, October.
  3. Chen, Yong & Rosenthal, Stuart S., 2008. "Local amenities and life-cycle migration: Do people move for jobs or fun?," Journal of Urban Economics, Elsevier, vol. 64(3), pages 519-537, November.
  4. Jouke van Dijk & Piet H. Pellenbarg, 2000. "introduction: Spatial perspectives on firm demography," Papers in Regional Science, Springer, vol. 79(2), pages 107-110.
  5. Joris Knoben, 2006. "A Relational Account of the Causes of Spatial Firm Mobility," ERSA conference papers ersa06p1, European Regional Science Association.
  6. Gilles Duranton & Diego Puga, 2000. "Nursery Cities: Urban diversity, process innovation, and the life-cycle of products," Working Papers dpuga-00-01, University of Toronto, Department of Economics.
  7. Brouwer, A.E. & Mariotti, I. & Ommeren, J.N. van, 2003. "The firm relocation decision: an empirical investigation," Serie Research Memoranda 0023, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
  8. Borsch-Supan, Axel, 1990. "Education and its double-edged impact on mobility," Economics of Education Review, Elsevier, vol. 9(1), pages 39-53, March.
  9. Erickson, Rodney A. & Wasylenko, Michael, 1980. "Firm relocation and site selection in suburban municipalities," Journal of Urban Economics, Elsevier, vol. 8(1), pages 69-85, July.
  10. Leo van Wissen, 2000. "A micro-simulation model of firms: Applications of concepts of the demography of the firm," Papers in Regional Science, Springer, vol. 79(2), pages 111-134.
  11. Michael J. Wasylenko, 1980. "Evidence of Fiscal Differentials and Intrametropolitan Firm Relocation," Land Economics, University of Wisconsin Press, vol. 56(3), pages 339-349.
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