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Public-sector financial incentives for business relocation and effectiveness measures based on company profile and geographic zone




Do public financial incentives still influence business location and relocation decisions? Examined herein will be empirical evidence drawn from three regional policies in three regions of France. This study will propose various location modeling types, both older and more contemporary cost-minimization models. We will also be proposing an empirical test to determine the effectiveness of public financial incentives for location and relocation decisions on the basis of profiles from 301 companies set up in three French regions. Our results underscore that in this case, subsidies do not trigger the dynamic of self-sustaining territorial construction. This finding proves less detrimental for core and intermediate regions than that for outlying region (like the Limousin). These results could lend confirmation to the premise that innovative companies should prefer the advantages associated with technology-based externalities, which for the most part embody tacit knowledge, in comparison with the positive perception of subsidy awards. The simple financial public location incentives from the past should be challenged anew.
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Suggested Citation

  • Samira Oukarfi & Maurice Baslé, 2009. "Public-sector financial incentives for business relocation and effectiveness measures based on company profile and geographic zone," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 43(2), pages 509-526, June.
  • Handle: RePEc:spr:anresc:v:43:y:2009:i:2:p:509-526 DOI: 10.1007/s00168-008-0223-1

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    References listed on IDEAS

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    Cited by:

    1. Sharif, Naubahar & Huang, Can, 2012. "Innovation strategy, firm survival and relocation: The case of Hong Kong-owned manufacturing in Guangdong Province, China," Research Policy, Elsevier, vol. 41(1), pages 69-78.
    2. repec:bla:revurb:v:29:y:2017:i:1:p:18-45 is not listed on IDEAS
    3. Conroy, Tessa & Deller, Steven & Tsvetkova, Alexandra, 2016. "Regional business climate and interstate manufacturing relocation decisions," Regional Science and Urban Economics, Elsevier, vol. 60(C), pages 155-168.

    More about this item


    R12 - Size and spatial distributions of regionaleconomic activity; R3 - Production analysis and firm location; R53 - Public facility location; R58 - Regional development policy; L53 - Government promotion of firms;

    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)


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