IDEAS home Printed from https://ideas.repec.org/p/lsg/lsgwps/wp282.html
   My bibliography  Save this paper

The impact of broadband and other infrastructure on the location of new business establishments

Author

Listed:
  • Daire McCoy, Sean Lyons, Edgar Morgenroth, Donal Palcic, Leonie Allen

Abstract

This paper analyses the impact of broadband infrastructure, along with a range of other local charac- teristics such as motorways and other infrastructure, availability of human capital and access to third level educational facilities, on the location of new business establishments. The sample period spans the intro- duction and recent history of broadband in Ireland. The results indicate that the availability of broadband infrastructure is a significant determinant, but its effects may be mediated by the presence of suffciently high human capital in an area.

Suggested Citation

  • Daire McCoy, Sean Lyons, Edgar Morgenroth, Donal Palcic, Leonie Allen, 2017. "The impact of broadband and other infrastructure on the location of new business establishments," GRI Working Papers 282, Grantham Research Institute on Climate Change and the Environment.
  • Handle: RePEc:lsg:lsgwps:wp282
    as

    Download full text from publisher

    File URL: http://www.lse.ac.uk/GranthamInstitute/wp-content/uploads/2017/10/Working-paper-282_McCoy-et-al-1.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Paulo Guimarães & Octávio Figueirdo & Douglas Woodward, 2003. "A Tractable Approach to the Firm Location Decision Problem," The Review of Economics and Statistics, MIT Press, vol. 85(1), pages 201-204, February.
    2. Cameron,A. Colin & Trivedi,Pravin K., 2013. "Regression Analysis of Count Data," Cambridge Books, Cambridge University Press, number 9781107667273, Fall.
    3. Bertanha Marinho & Moser Petra, 2016. "Spatial Errors in Count Data Regressions," Journal of Econometric Methods, De Gruyter, vol. 5(1), pages 49-69, January.
    4. Feldman, Maryann P. & Audretsch, David B., 1999. "Innovation in cities:: Science-based diversity, specialization and localized competition," European Economic Review, Elsevier, vol. 43(2), pages 409-429, February.
    5. Anders Akerman & Ingvil Gaarder & Magne Mogstad, 2015. "The Skill Complementarity of Broadband Internet," The Quarterly Journal of Economics, Oxford University Press, vol. 130(4), pages 1781-1824.
    6. Schmidheiny, Kurt & Brülhart, Marius, 2011. "On the equivalence of location choice models: Conditional logit, nested logit and Poisson," Journal of Urban Economics, Elsevier, vol. 69(2), pages 214-222, March.
    7. Fazia Pusterla & Laura Resmini, 2005. "Where do foreign firms locate in transition Countries? An empirical investigation," ISLA Working Papers 20, ISLA, Centre for research on Latin American Studies and Transition Economies, Universita' Bocconi, Milano, Italy, revised Sep 2005.
    8. Chandra R. Bhat & Rajesh Paleti & Palvinder Singh, 2014. "A Spatial Multivariate Count Model For Firm Location Decisions," Journal of Regional Science, Wiley Blackwell, vol. 54(3), pages 462-502, June.
    9. Haller, Stefanie A. & Lyons, Seán, 2015. "Broadband adoption and firm productivity: Evidence from Irish manufacturing firms," Telecommunications Policy, Elsevier, vol. 39(1), pages 1-13.
    10. Gian Luca Clementi & Dino Palazzo, 2010. "Entry, Exit, Firm Dynamics, and Aggregate Fluctuations," Working Paper series 27_10, Rimini Centre for Economic Analysis.
    11. David H. Autor & Frank Levy & Richard J. Murnane, 2003. "The skill content of recent technological change: an empirical exploration," Proceedings, Federal Reserve Bank of San Francisco, issue Nov.
    12. Kolko, Jed, 2012. "Broadband and local growth," Journal of Urban Economics, Elsevier, vol. 71(1), pages 100-113.
    13. Jofre-Monseny, Jordi & Marín-López, Raquel & Viladecans-Marsal, Elisabet, 2011. "The mechanisms of agglomeration: Evidence from the effect of inter-industry relations on the location of new firms," Journal of Urban Economics, Elsevier, vol. 70(2-3), pages 61-74, September.
    14. Luisa Corrado & Bernard Fingleton, 2012. "Where Is The Economics In Spatial Econometrics?," Journal of Regional Science, Wiley Blackwell, vol. 52(2), pages 210-239, May.
    15. Acs, Zoltan J. & Armington, Catherine, 2004. "The impact of geographic differences in human capital on service firm formation rates," Journal of Urban Economics, Elsevier, vol. 56(2), pages 244-278, September.
    16. Salvador Barrios & Holger Görg & Eric Strobl, 2006. "Multinationals' Location Choice, Agglomeration Economies, and Public Incentives," International Regional Science Review, , vol. 29(1), pages 81-107, January.
    17. Ivan T. Kandilov & Mitch Renkow, 2010. "Infrastructure Investment and Rural Economic Development: An Evaluation of USDA's Broadband Loan Program," Growth and Change, Wiley Blackwell, vol. 41(2), pages 165-191, June.
    18. Paulo Guimarães & Octávio Figueiredo & Douglas Woodward, 2004. "Industrial Location Modeling: Extending the Random Utility Framework," Journal of Regional Science, Wiley Blackwell, vol. 44(1), pages 1-20, February.
    19. Devereux, Michael P. & Griffith, Rachel & Simpson, Helen, 2007. "Firm location decisions, regional grants and agglomeration externalities," Journal of Public Economics, Elsevier, vol. 91(3-4), pages 413-435, April.
    20. Gilles Duranton & Diego Puga, 2001. "Nursery Cities: Urban Diversity, Process Innovation, and the Life Cycle of Products," American Economic Review, American Economic Association, vol. 91(5), pages 1454-1477, December.
    21. Audretsch, David B. & Lehmann, Erik E. & Warning, Susanne, 2005. "University spillovers and new firm location," Research Policy, Elsevier, vol. 34(7), pages 1113-1122, September.
    22. Iulia Siedschlag & Xiaoheng Zhang & Donal Smith, 2013. "What determines the location choice of multinational firms in the information and communication technologies sector?," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 22(6), pages 581-600, September.
    23. Carlton, Dennis W, 1983. "The Location and Employment Choices of New Firms: An Econometric Model with Discrete and Continuous Endogenous Variables," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 440-449, August.
    24. Elizabeth A. Mack & Luc Anselin & Tony H. Grubesic, 2011. "The importance of broadband provision to knowledge intensive firm location," Regional Science Policy & Practice, Wiley Blackwell, vol. 3(1), pages 17-35, March.
    25. Adelheid Holl, 2004. "Transport Infrastructure, Agglomeration Economies, and Firm Birth: Empirical Evidence from Portugal," Journal of Regional Science, Wiley Blackwell, vol. 44(4), pages 693-712, November.
    26. Minghao Li & Stephan J. Goetz & Mark Partridge & David A. Fleming, 2016. "Location determinants of high-growth firms," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 28(1-2), pages 97-125, January.
    27. Elizabeth A. Mack & Tony H. Grubesic, 2009. "Broadband Provision And Firm Location In Ohio: An Exploratory Spatial Analysis," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 100(3), pages 298-315, July.
    28. Nina Czernich & Oliver Falck & Tobias Kretschmer & Ludger Woessmann, 2011. "Broadband Infrastructure and Economic Growth," Economic Journal, Royal Economic Society, vol. 121(552), pages 505-532, May.
    29. Holl, Adelheid, 2004. "Manufacturing location and impacts of road transport infrastructure: empirical evidence from Spain," Regional Science and Urban Economics, Elsevier, vol. 34(3), pages 341-363, May.
    30. Hausman, Jerry & Hall, Bronwyn H & Griliches, Zvi, 1984. "Econometric Models for Count Data with an Application to the Patents-R&D Relationship," Econometrica, Econometric Society, vol. 52(4), pages 909-938, July.
    31. Elisabet Viladecans-Marsal, 2004. "Agglomeration economies and industrial location: city-level evidence," Journal of Economic Geography, Oxford University Press, vol. 4(5), pages 565-582, November.
    32. Mack, Elizabeth A. & Rey, Sergio J., 2014. "An econometric approach for evaluating the linkages between broadband and knowledge intensive firms," Telecommunications Policy, Elsevier, vol. 38(1), pages 105-118.
    33. Charles F. Manski, 1993. "Identification of Endogenous Social Effects: The Reflection Problem," Review of Economic Studies, Oxford University Press, vol. 60(3), pages 531-542.
    34. Koutroumpis, Pantelis, 2009. "The economic impact of broadband on growth: A simultaneous approach," Telecommunications Policy, Elsevier, vol. 33(9), pages 471-485, October.
    35. Hidalgo Pérez, Manuel A. & O׳Kean Alonso, José María & Rodríguez López, Jesús, 2016. "Labor demand and ICT adoption in Spain," Telecommunications Policy, Elsevier, vol. 40(5), pages 450-470.
    36. Coughlin, Cletus C & Terza, Joseph V & Arromdee, Vachira, 1991. "State Characteristics and the Location of Foreign Direct Investment within the United States," The Review of Economics and Statistics, MIT Press, vol. 73(4), pages 675-683, November.
    37. Catherine Armington & Zoltan Acs, 2002. "The Determinants of Regional Variation in New Firm Formation," Regional Studies, Taylor & Francis Journals, vol. 36(1), pages 33-45.
    38. Button, Kenneth J. & Lietham, Scott & McQuaid, Ronald W. & Nelson, John D., 1995. "Transport and Industrial and Commercial Location," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 29(2), pages 189-206, May.
    39. Elizabeth A. Mack, 2014. "Broadband and knowledge intensive firm clusters: Essential link or auxiliary connection?," Papers in Regional Science, Wiley Blackwell, vol. 93(1), pages 3-29, March.
    40. Manuel Hidalgo-Pérez & Jesús Rodríguez López & José M. Okean, 2015. "Labor Demand and ICT Adoption in Spain," Working Papers 15.10, Universidad Pablo de Olavide, Department of Economics.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bijedić, Teita & Butkowski, Olivier K. & Kay, Rosemarie & Suprinovič, Olga, 2020. "Bestimmungsfaktoren des regionalen Gründungsgeschehens - eine Machbarkeitsstudie," IfM-Materialien 280, Institut für Mittelstandsforschung (IfM) Bonn.
    2. Jung, Juan & López-Bazo, Enrique, 2020. "On the regional impact of broadband on productivity: The case of Brazil," Telecommunications Policy, Elsevier, vol. 44(1).
    3. Lehtonen, Olli, 2020. "Population grid-based assessment of the impact of broadband expansion on population development in rural areas," Telecommunications Policy, Elsevier, vol. 44(10).
    4. Thonipara, Anita & Sternberg, Rolf G. & Proeger, Till & Haefner, Lukas, 2020. "Assessing the Digital Divide and its Regional Determinants: Evidence from a Web-Scraping Analysis," ifh Working Papers 25/2020, Volkswirtschaftliches Institut für Mittelstand und Handwerk an der Universität Göttingen (ifh).
    5. Bahia, Kalvin & Castells, Pau & Pedrós, Xavier, 2019. "The impact of mobile technology on economic growth: global insights from 2000-2017 developments," 30th European Regional ITS Conference, Helsinki 2019 205164, International Telecommunications Society (ITS).
    6. Philip Chen & Edward J Oughton & Pete Tyler & Mo Jia & Jakub Zagdanski, 2020. "Evaluating the impact of next generation broadband on local business creation," Papers 2010.14113, arXiv.org.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. McCoy, Daire & Lyons, Sean & Morgenroth, Edgar & Palcic, Donal & Allen, Leonie, 2016. "The impact of local infrastructure on new business establishments," MPRA Paper 69074, University Library of Munich, Germany.
    2. Niklas Elert, 2014. "What determines entry? Evidence from Sweden," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 53(1), pages 55-92, August.
    3. Hasbi, Maude, 2020. "Impact of very high-speed broadband on company creation and entrepreneurship: Empirical Evidence," Telecommunications Policy, Elsevier, vol. 44(3).
    4. Megha Mukim & Peter Nunnenkamp, 2012. "The Location Choices of Foreign Investors: A District-level Analysis in India," The World Economy, Wiley Blackwell, vol. 35(7), pages 886-918, July.
    5. Combes, Pierre-Philippe & Gobillon, Laurent, 2015. "The Empirics of Agglomeration Economies," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 247-348, Elsevier.
    6. Philip Chen & Edward J Oughton & Pete Tyler & Mo Jia & Jakub Zagdanski, 2020. "Evaluating the impact of next generation broadband on local business creation," Papers 2010.14113, arXiv.org.
    7. Mack, Elizabeth A. & Wentz, Elizabeth, 2017. "Industry variations in the broadband business nexus," Socio-Economic Planning Sciences, Elsevier, vol. 58(C), pages 51-62.
    8. Koster, Hans R.A. & van Ommeren, Jos & Rietveld, Piet, 2014. "Estimation of semiparametric sorting models: Explaining geographical concentration of business services," Regional Science and Urban Economics, Elsevier, vol. 44(C), pages 14-28.
    9. Jordi Jofre-Monseny & Raquel Marín-López & Elisabet Viladecans-Marsal, 2012. "What underlies localization and urbanization economies? Evidence from the location of new firms," Working Papers 2012/9, Institut d'Economia de Barcelona (IEB).
    10. Stockinger, Bastian, 2017. "The effect of broadband internet on establishments' employment growth: evidence from Germany," IAB Discussion Paper 201719, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    11. Kim, Hyungtai & Ahn, Sanghoon & Ulfarsson, Gudmundur F., 2018. "Transportation infrastructure investment and the location of new manufacturing around South Korea's West Coast Expressway," Transport Policy, Elsevier, vol. 66(C), pages 146-154.
    12. Bertschek, Irene & Briglauer, Wolfgang & Hüschelrath, Kai & Kauf, Benedikt & Niebel, Thomas, 2016. "The economic impacts of telecommunications networks and broadband internet: A survey," ZEW Discussion Papers 16-056, ZEW - Leibniz Centre for European Economic Research.
    13. Chandra R. Bhat & Rajesh Paleti & Palvinder Singh, 2014. "A Spatial Multivariate Count Model For Firm Location Decisions," Journal of Regional Science, Wiley Blackwell, vol. 54(3), pages 462-502, June.
    14. Marius Brülhart & Kurt Schmidheiny, 2015. "Estimating The Rivalness Of State-Level Inward Fdi," Journal of Regional Science, Wiley Blackwell, vol. 55(1), pages 139-148, January.
    15. Josep‐Maria Arauzo‐Carod & Daniel Liviano‐Solis & Miguel Manjón‐Antolín, 2010. "Empirical Studies In Industrial Location: An Assessment Of Their Methods And Results," Journal of Regional Science, Wiley Blackwell, vol. 50(3), pages 685-711, August.
    16. Jordi Jofre-Monseny & Raquel Marín-López & Elisabet Viladecans-Marsal, 2014. "The Determinants Of Localization And Urbanization Economies: Evidence From The Location Of New Firms In Spain," Journal of Regional Science, Wiley Blackwell, vol. 54(2), pages 313-337, March.
    17. Rui Baptista & Joana Mendonça, 2010. "Proximity to knowledge sources and the location of knowledge-based start-ups," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 45(1), pages 5-29, August.
    18. Miguel C. Manjon-Antolin & Josep Maria Arauzo-Carod, 2006. "Locations and Relocations: Modelling, Determinants, and Interrelations," ERSA conference papers ersa06p33, European Regional Science Association.
    19. Josep‐Maria Arauzo‐Carod, 2008. "Industrial Location At A Local Level: Comments On The Territorial Level Of The Analysis," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 99(2), pages 193-208, April.
    20. Marius Brülhart & Mario Jametti & Kurt Schmidheiny, 2012. "Do agglomeration economies reduce the sensitivity of firm location to tax differentials?," Economic Journal, Royal Economic Society, vol. 122(563), pages 1069-1093, September.

    More about this item

    JEL classification:

    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:lsg:lsgwps:wp282. 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: . General contact details of provider: https://edirc.repec.org/data/grlseuk.html .

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: The GRI Administration (email available below). General contact details of provider: https://edirc.repec.org/data/grlseuk.html .

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.