IMMIGRATION AND FIRM EXPANSION*

ABSTRACT Research generally focuses on how immigration affects native workers, while the impact of immigration on domestic firms is often overlooked. This paper addresses this important omission by examining whether firms respond to immigration by expanding their production activities within a city in order to utilize the abundant supply of low‐skilled workers. Using data on immigration and the universe of establishments in U.S. cities, the results indicate that firms respond to immigration at the extensive margin by increasing the number of establishments. Not surprisingly, immigration has a more positive impact on the number of establishments that are small in size and in relatively mobile, low‐skill intensive industries. Additional evidence indicates that immigration has little impact on employment within existing establishments, the intensive margin, or on the number of establishments in service industries which may expand simply due to immigrant consumption.     

The Spatial Patterns of Networks,Hierarchies and Subsidiaries

This article reviews evidence and arguments linking the networking behaviour of firms with geographic distance, before examining the spatial relationships of electronics firms in the three major electronics centres in Spain. The focus is on the spatial pattern and extent of different types of inter-firm relations. Based on the analysis of 184 surveyed establishments, displaying different ownership and organization characteristics, the results show that while regional linkages are important, significant extra-regional linkages are also maintained by firms in regional clusters. The spatial extent of linkages depends on the mode of relations; arm's length, network and hierarchy relations show different spatial patterns, as do different types of cooperation. The importance of extra-regional linkages also varies with firm- and plant-specific characteristics. Extra-regional linkages are more common among larger and more R&D-intensive firms, firms with greater presence in the rest of the country and firms with more experience of cooperation and more stable relationships.     

SPATIAL IMPACTS OF AGGLOMERATION EXTERNALITIES*

ABSTRACT This article examines the extent to which agglomeration economies in one location affect employment growth and establishment births, using data from the Dutch province of South‐Holland. The data are of particular interest because they represent a census, rather than a sample, of all establishments and the location of establishments can be pinpointed to within 416 (postal) zip code areas averaging less than 6 km² in size. Results suggest that agglomeration economies positively affect employment growth and the location of new establishments, but with the possible exception of manufacturing, this effect dies out quickly with distance. Thus, the main finding is that for many industries, agglomerative forces may well operate at a geographic scale that is smaller than a city.     

The spatial dimension of internal labor markets

We integrate into a unified framework the spatial and the employment dimensions of worker mobility, tracing workers across firms, across establishments, and across regions. Drawing upon the spatial dimension of internal labor markets in firms with multiple establishments in multiple locations, our results indicate that the contemporaneous wage premium to migration is around 3 percentage points. For the case of job switchers, we find that the return to regional migration is due to access to better jobs at the destination. We also document the existence of an urban premium for same‐employer migrants but for employer changes this premium is driven by selection.     

THE RELATIONSHIP BETWEEN THE ESTABLISHMENT AGE DISTRIBUTION AND URBAN GROWTH*

ABSTRACT This paper explores the relationship between urban growth and establishment‐level dynamics through geographic variations in the establishment age distribution. Using administrative microdata, I find that faster growing cities have higher rates of entry and exit, and younger establishments, on average. The resulting differences in the age distribution account for 38 percent of the variation in MSA employment growth, leaving the majority due to differences among establishments of the same age. In particular, entry and the growth and survival of young establishments (aged five years or less) account for the majority of the variation in MSA growth.     

The Net Effects of Large Plant Locations and Expansions on County Employment*

This paper argues that the net economic impact of new firm locations or expansions is determined by a multitude of opposing forces. Using a unique database, I set out to evaluate the net effects of these opposing forces by looking at the net change in local employment and population arising from large (greater than 300 new jobs) firm locations or expansions in the State of Georgia. The analysis suggests that the employment multipliers associated with new firm locations are much less than one; that is, the net employment effect of a large firm opening is smaller than the gross employment impact. This result is consistent with other empirical economic impact studies, which find multipliers much smaller than those of typical input–output models, often less than unity, and a previous study showing little net effect of large plant openings. Expansions of existing establishments are shown to have substantial multiplicative effects, however, with an average employment multiplier of 2.0. I discuss possible reasons for differential impacts across new and expanding firms, focusing on the nature of the firms. Differences in net impact across industries and high‐tech versus low‐tech firms also is evaluated. I find that the impact of large firm locations or expansions on population in the resident county generally is negative, but positive for the broader region encompassing the county of location and its contiguous neighbors.     

Noril'sk Nickel: A Global Company?

Two specialists on Russia's minerals industries examine the evidence supporting the argument that the Russian mining conglomerate Noril'sk Nickel can be viewed as a global company. Included among the criteria they assess are the geographic dispersion of the company's markets and operations, the diversified and multinational character of its ownership, whether it has matched the performance standards set by its major international competitors, and the effect of the company's ownership presence on the management style of its foreign operations. A particular focus is on how an ongoing conflict between two major Russian oligarch shareholders (Vladimir Potanin and Oleg Deripaska) has shaped Noril'sk Nickel's ownership and management structure, which is characterized by the continued (background) presence of the state, the lack of any organized policy for training a multinational management cohort, and the absence of a major block of foreign shareholders. In the end, they conclude that Noril'sk Nickel is not a genuinely global but rather a Tier-1 Russian company, albeit one with a global scale of operations.     

Industry Characteristics Linked to Establishment Concentrations in Nonmetropolitan Areas

In this paper we investigate industry characteristics associated with the clustering of establishments in three-digit SIC manufacturing industries in nonmetropolitan areas. The dispersion parameter k of the negative binomial distribution is selected as the measure of industry spatial concentration. Associations between industry characteristics and spatial concentration are investigated using OLS regression analysis. Our findings indicate that the spatial clustering of establishments is positively related to industry average establishment size, reliance on natural resource inputs, labor intensity, cost shares of professional and technical employees, and cost shares of low-skilled workers. Agglomeration is negatively related to multiplant structure, employment in precision production, and reliance on local product and input markets.     

Knowledge Networks as a Regional Development Resource: A Network Analysis of the Interlinks between Scientific Institutions and Regional Firms in the Metropolitan region of Hanover,Germany

The debate on regional innovation potentials has concentrated in recent times upon the topic of regional knowledge networking. This article presents the findings of the first phase of a detailed network analysis of the cooperation relations between scientific institutions and firms in the “metropolitan region Hanover-Brunswick-Göttingen”. The research concentrated on the regional and supra-regional cooperation relations of approximately 500 science establishments of the region, including their interlinks with private sector firms. This analysis of a polycentric metropolitan region's knowledge networks in different fields of competence produced detailed information on the density of knowledge interlinking within the region, on the degree of connectivity between the region's scientific institutions and private sector firms, and on central network nodes within the regional innovation networks. The case study exemplifies the methodical approach of a regional network analysis and emphasizes the role of knowledge networks as a development resource which is of particular relevance to the region's innovation capacities.     

Geographic concentrations in Turkey's manufacturing industry: identifying regional highpoint clusters1

The theory of economic development based on industry clusters emphasizes the importance of co-location of firms or industries with potential to share technical information and knowledge transfer. The paper identifies industry cluster templates in Turkey using the 1996 Turkish input/output table. Engineering and textile clusters are the largest ones with respect to the number of establishments and employment. Majority of manufacturing clusters are located in ?stanbul, ?zmir, Ankara/K?r?kkale and Çukurova districts. The study points out the importance of newly developing centres near the periphery of Ankara and several production centres in Anatolia.     

The Effect of State Economic Development Incentives on Employment Growth of Establishments

This paper examines the effects of state economic development incentives on the growth of 366 Ohio manufacturing and nonmanufacturing establishments that launched major expansions between 1993 and 1995. Growth is measured as the actual employment change that occurred in these establishments and as the employment growth announced when expansions were launched. Empirical findings indicate that incentives have very little (or even a negative) effect on actual growth and they have a substantial positive effect on announced growth. Findings also suggest that establishments that received incentives overestimated their announced employment targets more than establishments that did not receive incentives.     

Characteristics of Collaboration in Product Innovation in the Regional System of Innovation of East Gothia

The focus of this article is on product innovations introduced by firms (establishments) and the collaborations they enter into with other firms and organizations in carrying out this activity. The theoretical framework combines innovation theories with the literature on regional innovation systems and the knowledge-based economy. Empirically we have investigated characteristics of collaboration among manufacturing establishments in the region of East Gothia in Sweden, with specific focus on the number of employees involved in the innovation projects, mechanisms of knowledge transfer between organizations, as well as financing and patenting in relation to product innovations.     

Evaluating the geographic concentration of industries using distance-based methods

We propose new methods for evaluating the spatial distributionof firms. To assess whether firms are concentrated or dispersed,economists have tradi-tionally used indices that analyse theheterogeneity of a spatial structure at a single geographiclevel. We introduce distance-based methods, Besag's L function(derived from Ripley's K function) and Diggle and Chetwynd'sD function to describe simultaneously spatial distribution atdifferent geographical scales. Our empirical applications considerthe distribution of French manufacturing firms in the Parisarea and in France generally. For some geographic levels, resultsshow significant concentration or dispersion of firms accordingto their sector of activity.     

SMALL BUSINESS VIABILITY IN THE URBAN GHETTO*

ABSTRACT Within the minority communities of large SMSAs, neither the black-owned business nor the small nonminority enterprises are flourishing. Facing limited access to financial capital as well as constrained markets, the ghetto firms that do persist are typically quite small in terms of sales and employment. Among black establishments, the least educated entrepreneurs are the ones who are most likely to remain in business. Unless greater financial capital is forthcoming and better educated owners are induced to remain in business, the business community that is located in minority neighborhoods of large urban areas may be destined to stagnate.     

Löschian Spatial Competition in an Emerging Retail Industry

Löschian competition is traditionally thought to lead to a spatial equilibrium in which firms enter an industry and disperse across geographic space until each firm earns insufficient excess profit to attract net new entrants. This paper assesses the appropriateness of Löschian analysis using video (movie) rental establishments in Toronto as a case example. The video rental business, as we know it today, began to take shape around 1980 and has since seen much turnover. The paper describes the changing pattern of single‐site and chain stores between 1982 and 1999. I use logistic regression to predict the survival of existing establishments. Using survivorship as a proxy for profit, the paper draws conclusions about the extent to which temporal changes in video store location correspond to the tenets of Löschian competition. The coexistence of chain and single‐site stores suggests that there are distinct market niches and that single‐site stores have used a “swarming” strategy to compete against chains. Conclusions are drawn about how the retail sector might evolve in the future because of the locational competition between chains and single‐site stores.     

Requiem or rebirth? Internal labour markets and labour market restructuring in the Kitchener and Sault Ste. Marie regions

Since the 1980s, social scientists and economic geographers have stressed that 'standard' forms of employment and internal labour markets (ILMs) which characterized Fordism have declined and have been displaced by post-Fordist non-standard and contingent employment arrangements. However, some researchers are critical of the assumptions of a universal decline in ILMs and stress that although ILMs have been significantly restructured, they remain an important part of firm employment strategies. On the basis of a postal survey and interviews conducted with ninety firms and institutions in Kitchener-Waterloo and Sault Ste. Marie, Ontario, in 1995–1996, I assess the role of ILMs. Although shifts towards non-standard arrangements are evident, employers are clearly aware of the need to maintain if not develop ILM structures. Finally, I argue that geographers need to reconceptualize the relationships between ILMs and external labour markets (ELMs) as integrated phenomena. Thus firms do not use contingent or ELMs and ILMs in exclusion to each other but as part of a continuum of strategies leading to increased blurring of the ILM and ELMs.     

Firm Heterogeneity in Biotech: Absorptive Capacity,Strategies and Local-Regional Connections

This paper focuses on the characteristics of biotech firms with various levels of research and development (R&D) activity. It is done by exploring the relationship between R&D intensity, alliances and the extent of regionalization of firms' activities using evidence from a survey of US-based biotechnology firms. We profile two firm prototypes: research-oriented firms and product-oriented firms, focusing on their characteristics, strategies and operations. These include activities devoted to exploration and exploitation through alliances with universities (more exploration) and with pharmaceutical companies (exploration and exploitation), and locational needs which facilitate both exploration and exploitation.     

Writing up the region: anchor firm dismantling and the construction of a perceived regional advantage in Swedish news media

This study investigates how geographic representations and regional industrial identity in news media are used to mobilize local/regional actors and to attract inward and outward investments by mediating and narrating stories of the recovery and rebirth of a region in distress – that is, how media contribute to economic development in or of the region. The study targets media attention covering the dismantling and relocation of two regionally embedded life science and likewise anchor firms: the Pharmacia and Upjohn merger in Uppsala in 1995 and the closure of AstraZeneca's operations in Lund in 2010. By drawing on the method of framing and content analysis of news articles derived from a public media database, the analysis show that: (a) geographic representation and associations are intensified in times of media turbulence; (b) news coverage follows two subsequent phases (an initial ‘crisis’ phase and a following more optimistic ‘recovery’ phase) and (c) news media (as intermediary actors and arenas) by communicating ideas of a shared regional industrial identity contribute to the construction of a ‘perceived regional advantage’ (as understood and communicated by news media). Thus, regional industrial identity-building and how the region is perceived by internal and external audiences are important for regional development.     

An Information-theoretic Analysis: An Application to Soviet-COMECON Trade Flows

This paper develops a classificatory methodology designed to assign geographic entities to groupings based upon the multivariate flow profiles displayed by the entities and a dispersion statistic designed to detect dynamic shifts in these flow profiles over time. Information statistic, provide the mathematical basis of the analysis and the changing trade profiles of the member nations of COMECON provide an illustrative case study.     

Modelling tourism and hospitality employment clusters: a spatial econometric approach

ABSTRACT

Geographic clustering of industries for mutual economic benefit has long been recognised. The concept of ‘externalities’ introduced by Alfred Marshall early last century rely on agglomeration of specialised industry within a geographic area. However, only recently has cluster modelling been applied to the tourism and hospitality (T&H) industry. The aim of this paper, therefore, is twofold: first is to develop a cluster-based theoretical framework for delineating geographic boundaries of T&H clusters, and second is to identify the underlying factors that drive their form and shape.

Drawing on employment data as the basis for co-location of T&H firms, spatial econometrics techniques are applied to model the spatial clustering of T&H employment in Victoria, Australia. Results show that rural tourism regions have higher levels of employment in tourism operational services whereas employment in city-based regions is more concentrated in hospitality services. Our findings, when normalised as a percentage of total employment, show that rural and regional Victoria ranks most highly as employers in the T&H industry. Adopting a range of spatial metrics, we show that T&H clustering throughout Victoria is largely driven by six location-specific factors: (1) the availability of tourism attractions; (2) proximity to the coast; (3) the road density network; (4) accessibility to employment within the Melbourne CBD; (5) the scale of the regional economy; and, (6) the advantages and disadvantages associated with economic resources. We conclude that the cluster-led strategy pose a number of challenges for tourism planners to promote regional tourism. Nevertheless, results from this study indicate that T&H employment clustering creates a more cohesive spatial structure that could support economic development and better connectedness of tourism destinations. These clusters could act as service hubs to their wider catchment areas where visitors are encouraged to stay overnight and travel to specific sights during the day.