[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/a/sae/ecdequ/v34y2020i2p140-153.html
   My bibliography  Save this article

Incentives and Firm Migration: An Interstate Comparison Approach

Author

Listed:
  • Yuxuan Pan
  • Tessa Conroy
  • Alexandra Tsvetkova
  • Matthew Kures
Abstract
The authors model how state business incentives influence interstate relocation patterns of manufacturers using a panel (2000-2011) of 32 states. The National Establishment Time Series database and the Panel Database on Incentives and Taxes are used to study relocation by manufacturing establishments based on differences between the origin and destination states. The authors find that traditional factors associated with business climate, such as taxation and subsidies, statistically influence manufacturing interstate relocation. Further analysis shows that policy changes (e.g., increasing incentives and reducing taxes) to induce manufacturers to relocate may need to be infeasibly large or used in combination to evoke an economically meaningful increase in relocations.

Suggested Citation

  • Yuxuan Pan & Tessa Conroy & Alexandra Tsvetkova & Matthew Kures, 2020. "Incentives and Firm Migration: An Interstate Comparison Approach," Economic Development Quarterly, , vol. 34(2), pages 140-153, May.
    • Handle: RePEc:sae:ecdequ:v:34:y:2020:i:2:p:140-153
    DOI: 10.1177/0891242420917756
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/0891242420917756
    Download Restriction: no
    File URL: https://libkey.io/10.1177/0891242420917756?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Rinaldo Evangelista & Matteo Lucchese & Valentina Meliciani, 2015. "Business services and the export performances of manufacturing industries," Journal of Evolutionary Economics, Springer, vol. 25(5), pages 959-981, November.
    2. repec:dgr:rugsom:02d31 is not listed on IDEAS
    3. 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.
    4. Steven C. Deller & Tessa Conroy, 2017. "Business survival rates across the urban–rural divide," Community Development, Taylor & Francis Journals, vol. 48(1), pages 67-85, January.
    5. Todd M. Gabe & David S. Kraybill, 2002. "The Effect of State Economic Development Incentives on Employment Growth of Establishments," Journal of Regional Science, Wiley Blackwell, vol. 42(4), pages 703-730.
    6. Tessa Conroy & Steven Deller & Alexandra Tsvetkova, 2017. "Interstate Relocation Of Manufacturers And Business Climate," Review of Urban & Regional Development Studies, Wiley Blackwell, vol. 29(1), pages 18-45, March.
    7. David Neumark & Junfu Zhang & Brandon Wall, 2007. "Employment Dynamics and Business Relocation: New Evidence from the National Establishment Time Series," Research in Labor Economics, in: Aspects of Worker Well-Being, pages 39-83, Emerald Group Publishing Limited.
    8. Linda McCarthy, 2015. "Something New or More of the Same in the Bidding Wars for Big Business?," Growth and Change, Wiley Blackwell, vol. 46(2), pages 153-171, June.
    9. Figueiredo, Octavio & Guimaraes, Paulo & Woodward, Douglas, 2002. "Home-field advantage: location decisions of Portuguese entrepreneurs," Journal of Urban Economics, Elsevier, vol. 52(2), pages 341-361, September.
    10. Robert C. Turner & Mark K. Cassell, 2007. "When Do States Pursue Targeted Economic Development Policies? The Adoption and Expansion of State Enterprise Zone Programs," Social Science Quarterly, Southwestern Social Science Association, vol. 88(1), pages 86-103, March.
    11. Lee, Yoonsoo, 2008. "Geographic redistribution of US manufacturing and the role of state development policy," Journal of Urban Economics, Elsevier, vol. 64(2), pages 436-450, September.
    12. Kristin Kronenberg, 2013. "Firm relocations in the Netherlands: Why do firms move, and where do they go?," Papers in Regional Science, Wiley Blackwell, vol. 92(4), pages 691-713, November.
    13. Bjørn Asheim & Lars Coenen, 2006. "Contextualising Regional Innovation Systems in a Globalising Learning Economy: On Knowledge Bases and Institutional Frameworks," The Journal of Technology Transfer, Springer, vol. 31(1), pages 163-173, January.
    14. Aleid E. Brouwer & Ilaria Mariotti & Jos N. van Ommeren, 2004. "The firm relocation decision: An empirical investigation," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 38(2), pages 335-347, June.
    15. Alexandra Tsvetkova & Jean-Claude Thill & Deborah Strumsky, 2014. "Metropolitan innovation, firm size, and business survival in a high-tech industry," Small Business Economics, Springer, vol. 43(3), pages 661-676, October.
    16. Strauss-Kahn, Vanessa & Vives, Xavier, 2009. "Why and where do headquarters move?," Regional Science and Urban Economics, Elsevier, vol. 39(2), pages 168-186, March.
    17. Pellenbarg, P.H. & Wissen, L.J.G. van & Dijk, J. van, 2002. "Firm relocation: state of the art and research prospects," Research Report 02D31, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    18. Miguel Manjón-Antolín & Josep-Maria Arauzo-Carod, 2011. "Locations and relocations: determinants, modelling, and interrelations," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 47(1), pages 131-146, August.
    19. Pennings, Enrico & Sleuwaegen, Leo, 2000. "International relocation: firm and industry determinants," Economics Letters, Elsevier, vol. 67(2), pages 179-186, May.
    20. Deller, Steven & Conroy, Tessa & Tsvetkova, Alexandra, 2015. "Factors Affecting the Interstate Migration of Manufacturing Firms: Much to Do about Nothing?," Staff Paper Series 578, University of Wisconsin, Agricultural and Applied Economics.
    21. 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.
    22. Elsie L. Echeverri-Carroll & Maryann P. Feldman, 2019. "Chasing entrepreneurial firms," Industry and Innovation, Taylor & Francis Journals, vol. 26(5), pages 479-507, May.
    23. Rink, David R. & Swan, John E., 1979. "Product life cycle research: A literature review," Journal of Business Research, Elsevier, vol. 7(3), pages 219-242, September.
    24. Gabe, Todd M. & Kraybill, David S., 1998. "Tax Incentive Requests and Offers in a State Economic Development Program," The Review of Regional Studies, Southern Regional Science Association, vol. 28(3), pages 1-14, Winter.
    25. Sung Hyo Hong, 2014. "Agglomeration and relocation: Manufacturing plant relocation in Korea," Papers in Regional Science, Wiley Blackwell, vol. 93(4), pages 803-818, November.
    26. Guerrieri, Paolo & Meliciani, Valentina, 2005. "Technology and international competitiveness: The interdependence between manufacturing and producer services," Structural Change and Economic Dynamics, Elsevier, vol. 16(4), pages 489-502, December.
    27. Grassmueck, Georg & Goetz, Stephan J. & Shields, Martin, 2008. "Youth Out-Migration from Pennsylvania: The Roles of Government Fragmentation vs. the Beaten Path Effect," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 38(1), pages 1-12.
    28. Anet Weterings & Joris Knoben, 2013. "Footloose: An analysis of the drivers of firm relocations over different distances," Papers in Regional Science, Wiley Blackwell, vol. 92(4), pages 791-809, November.
    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. Vanessa Hellwig, 2023. "Digital gravity? Firm birth and relocation patterns of young digital firms in Germany," Journal of Regional Science, Wiley Blackwell, vol. 63(2), pages 340-378, March.

    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. 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.
    2. Tessa Conroy & Steven Deller & Alexandra Tsvetkova, 2017. "Interstate Relocation Of Manufacturers And Business Climate," Review of Urban & Regional Development Studies, Wiley Blackwell, vol. 29(1), pages 18-45, March.
    3. Federica Rossi & Magdalena Dej, 2020. "Where do firms relocate? Location optimisation within and between Polish metropolitan areas," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 64(3), pages 615-640, June.
    4. Miguel C. Manjon-Antolin & Josep Maria Arauzo-Carod, 2006. "Locations and Relocations: Modelling, Determinants, and Interrelations," ERSA conference papers ersa06p33, European Regional Science Association.
    5. Miguel Manjón-Antolín & Josep-Maria Arauzo-Carod, 2011. "Locations and relocations: determinants, modelling, and interrelations," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 47(1), pages 131-146, August.
    6. Vanessa Hellwig, 2023. "Digital gravity? Firm birth and relocation patterns of young digital firms in Germany," Journal of Regional Science, Wiley Blackwell, vol. 63(2), pages 340-378, March.
    7. 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.
    8. Arauzo-Carod, Josep-Maria & Manjón-Antolín, Miguel & Martínez , Óscar, 2015. "The Relocation of R&D Establishments in France: An Empirical Analysis," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 33, pages 97-119.
    9. Yoojin Yi, 2018. "Firm relocation and age-dependent reliance on agglomeration externalities," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 61(2), pages 439-456, September.
    10. Kristin Kronenberg, 2013. "Firm relocations in the Netherlands: Why do firms move, and where do they go?," Papers in Regional Science, Wiley Blackwell, vol. 92(4), pages 691-713, November.
    11. Jiang, Yonglei & Liao, Feixiong & Jin, Lianjie, 2021. "Effects of locational accessibility on firm diffusion characteristics: The case of Sino-Europe Economic Corridor," Transport Policy, Elsevier, vol. 105(C), pages 80-93.
    12. Lampón, Jesús F. & Cabanelas, Pablo & Carballo-Cruz, Francisco, 2017. "A model for international production relocation: Multinationals' operational flexibility and requirements at production plant level," Journal of Business Research, Elsevier, vol. 77(C), pages 95-101.
    13. Lee, Yoonsoo, 2008. "Geographic redistribution of US manufacturing and the role of state development policy," Journal of Urban Economics, Elsevier, vol. 64(2), pages 436-450, September.
    14. Mark D. Partridge & M. Rose Olfert, 2011. "The Winners' Choice: Sustainable Economic Strategies for Successful 21st-Century Regions," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 33(2), pages 143-178.
    15. Balbontin, Camila & Hensher, David A., 2021. "Understanding business location decision making for transport planning: An investigation of the role of process rules in identifying influences on firm location," Journal of Transport Geography, Elsevier, vol. 91(C).
    16. Dario Musolino & Ilaria Mariotti & Aleid E. Brouwer, 2020. "Stated and revealed locational preferences of firms: a national scale perspective," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 64(3), pages 493-499, June.
    17. Jiang, Yonglei & Timmermans, Harry J.P. & Yu, Bin, 2018. "Relocation of manufacturing industry from the perspective of transport accessibility – An application of percolation theory," Transport Policy, Elsevier, vol. 63(C), pages 10-29.
    18. Alexandra Tsvetkova & Tessa Conroy & Jean-Claude Thill, 2020. "Surviving in a high-tech manufacturing industry: the role of innovative environment and proximity to metropolitan industrial portfolio," International Entrepreneurship and Management Journal, Springer, vol. 16(2), pages 501-527, June.
    19. Rongjun Long & Wei Lang & Xun Li, 2020. "Does Institutional Embeddedness Promote Regional Enterprises’ Migration? An Empirical Analysis Based on the “Double Transfer” Strategy in Guangdong, China," Sustainability, MDPI, vol. 12(7), pages 1-21, April.
    20. Calluzzo, Paul & Wang, Wei & Wu, Serena, 2021. "SEC scrutiny shopping," Journal of Corporate Finance, Elsevier, vol. 67(C).

    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:sae:ecdequ:v:34:y:2020:i:2:p:140-153. See general information about how to correct material in RePEc.

    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: SAGE Publications (email available below). General contact details of provider: .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.