The geographic component of production technology

In today’s global economy manufacturing companies are continuously re-evaluating their\ud location. In many instances companies decide to relocate some or all of their\ud manufacturing activities to so called low labor cost countries. However, the perception that\ud this is cost effective is not always correct. In many instances the costs of producing in low\ud labor cost countries are highly under estimated. In some instances the costs of the\ud production alone, i.e. excluding logistics cost, are already higher than producing in so\ud called high labor cost countries. Previous research suggests that some of the reasons for\ud these higher costs are related to the particular geographic environment. This study is\ud focused on increasing our understanding of the relationship between geographically\ud determined factors and production technology. Understanding the relationship between\ud geographical factors and production factors allows insight into production location and\ud companies may learn to avoid wrongly moving production away from the developed, high\ud labor cost, countries. For governments; knowledge on geographically determined factors\ud places governments in a better position to selectively nurture specific industries based on\ud their geography-production technology relationshi

Location Determinants of Food Manufacturing Investment: Are Non-metropolitan Counties Competitive?

Food manufacturing site selection is determined by infrastructure, agglomeration, product and input markets, labor markets, and fiscal attributes of local communities. This article examines how these factors influence location decisions across the rural-urban continuum in the lower forty-eight states of the U.S. Negative binomial regression and spatial clustering methods are used to forecast new food processor location patterns at the county level, 2000-2004. Remote rural areas are at a comparative disadvantage with respect to attracting food processors, but non-metropolitan counties with economic links to urban core areas may be attractive investment sites for footloose, supply, and demand-oriented food manufacturers.firm location, food manufacturing, negative binomial regression, spatial clustering, Community/Rural/Urban Development, R1, R3,

Understanding Mexican High-tech Organizations: A Conceptualization Problem?

This study investigates the differences between intensive technology and low-tech firms located in Mexico, focusing on the Human Resources Management functions. 31 interviews and 50 answered questionnaires were used in this analysis. The results show that while Mexico is not yet a fully developed technological country. Indeed, technologically intensive firms are rare cases. Mexico is progressing rapidly towards a technologically developed country in some sectors. Moreover, Mexico's technology intensive firms and its technological hubs have different implications and connotations as comparison to developed countries. Finally, Human Resources Management is still a traditional/manufacturing management style, for Mexico's technology intensive firms.Intensive technology firms, low-tech firms, technology hub, Human Resources Management, Mexico

Ethanol Plant Location Determinants and County Comparative Advantage

The location of ethanol plants is determined by infrastructure, product and input markets, fiscal attributes of local communities, and state and federal incentives. This empirical analysis uses probit regression along with spatial clustering methods to analyze investment activity of ethanol plants at the county level for the lower U.S. 48 states from 2000 to 2007. The availability of feedstock dominates the site selection decision. Other factors, such as access to navigable rivers or railroads, product markets, producer credit and excise tax exemptions, and methyl tertiary-butyl ether bans provided some counties with a comparative advantage in attracting ethanol plants.cluster analysis, comparative advantage, ethanol production, location model, Community/Rural/Urban Development, Environmental Economics and Policy, Political Economy, R1, R3,

Spatial determinants of Japanese manufacturing firms in the Czech Republic

This study casts light upon the locational distribution of industrial activites of Japanese multinational corporations (MNCs) in the Czech Republic at the regional level from 1999 through 2004. In our study, McFadden's conditional logit model is applied to trace the dynamic effects of a series of factors on locational choices of Japanese MNCs. We found evidence that the locational choice of Japanese MNCs is positively affected by industrial agglomeration effects resulting from potential interactions across and within existing Japanese and foreign firms owing to mitigation of various transaction costs. In addition, the presence of well-developed infrastructure systems and high wage level determine the location choice of Japanese MNCs, while distance matters. The empirical evaluation also contends that spatial determinants of MNCs vary by nationality in the Czech Republic. It is evident that agglomeration externalities and distance emerge as critical driving factors for Japanese MNCs and Asian MNCs. On the other hand, it has been verified that fiscal and financial incentives tend to highly motivate German MNCs, while local demand conditions have a great impact on Anglo-American MNCs. --regional attributes,agglomeration,Japanese FDI,conditional logit model,the Czech Republic,regional disparity,Japanese manufacturing start-ups,localization

The Organization of Firms Across Countries

We argue that social capital as proxied by trust increases aggregate productivity by affecting the organization of firms. To do this we collect new data on the decentralization of investment, hiring, production, and sales decisions from Corporate Headquarters to local plant managers in almost 4,000 firms in the United States, Europe, and Asia. We find that firms headquartered in high trust regions are more likely to decentralize, with trust accounting for about half of the variation in decentralization in our data. To help identify causal effects, we look within multinational firms, and show that higher levels of bilateral trust between the multinational's country of origin and subsidiary's country of location increases decentralization, even after instrumenting trust using religious and ethnic similarities between the countries. Trust raises aggregate productivity through two channels: (1) trust facilitates reallocation between firms by allowing more efficient firms to grow as CEOs can decentralize more decisions and (2) trust complements the adoption of new technologies, thereby increasing productivity within firms during times of rapid technological change.decentralization, trust, Rule of Law, social capital, theory of the firm

THE LOCATIONAL DETERMINANTS OF WESTERN NONMETRO HIGH TECH MANUFACTURERS: AN ECONOMETRIC ANALYSIS

The Tobit estimation procedure was used to determine the factors which influence the location and size of high technology manufacturers in nonmetro areas in the West. The results indicate that high tech branch plants tend to locate in populous counties adjacent to Metropolitan Statistical Areas (MSAs). Percent of local employment in manufacturing and agriculture was inversely related to branch plant employment, and the stock of human capital was not significantly related to employment. High tech unit plants also exhibited a propensity to locate in the more populous counties. Unlike branch plants, the unit concerns were more likely to develop or locate in communities with a highly educated work force and at greater distances from metro areas. The unit plants better fit the perception of high tech plants selecting high amenity locations with abundant skilled labor.Industrial Organization, Labor and Human Capital,

Tracking the Economy of the City of Atlanta: Past Trends and Future Prospects

This report explores the changes in the level and composition of employment in the City of Atlanta over the last 25 years. FRC Report 17

Industrial Location At the Intra-Metropolitan Level: A Negative Binomial Approach

The objective of this paper is to analyse the incidence of agglomeration economies on the new firms’ location decisions inside metropolitan areas. Following the literature we consider that agglomeration economies are related to the concentration of an industry (location economies) and/or the size of the city itself (urbanisation economies). We assume that those economies differ according the technological level of firms. So we use a sample of new firms belonging to high, intermediate and low technology levels. Our results confirm those sectoral differences and show some interesting location patterns of manufacturing firms Taking into account the renovated debate about the importance of the geography and distance in the location of economic activity, we introduce in the estimation the effect of the central city size as determinant for the location of new firms in the rest of the metropolitan area. This allows us to analyse if a suburbanisation effect exists and if that effect is the same depending on the industry and the central city size of the metropolitan area. Our main statistical source is the REI (Spanish Industrial Establishments Register), which has plant-level microdata for the creation and location of new industrial firms.

Private Sector Employment Growth, 1998-2004: A Panel Analysis of British Workplaces

Using nationally representative panel data for British private sector workplaces this paper points to the importance of distinguishing between workplace and firm size when analysing employment growth, and finds that the factors associated with growth differ markedly between single independent establishments and those belonging to multi-site firms. Results also differ according to whether one adjusts for sample selection arising from workplace survival, and according to whether one distinguishes between growth per se and internal, organic employment growth. We find evidence at the plant level that is consistent with creative job destruction.employment growth, workplace survival, workplace age, workplace size, humancapital, sunk costs