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The agglomeration of headquarters

Davis, James C. and Henderson, J. Vernon (2008) The agglomeration of headquarters. Regional Science and Urban Economics, 38 (5). pp. 445-460. ISSN 0166-0462

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Identification Number: 10.1016/j.regsciurbeco.2008.05.002

Abstract

This paper uses a micro data set on auxiliary establishments from 1977 to 1997 in order to investigate the determinants of headquarter agglomerations and the underlying economic base of many larger metro areas. The significance of headquarters in large urban settings is their ability to facilitate the spatial separation of their white collar activities from remote production plants. The results show that separation benefits headquarters in two main ways: the availability of differentiated local service input suppliers and the scale of other headquarter activity nearby. A wide diversity of local service options allows the headquarters to better match their various needs with specific experts producing service inputs from whom they learn, which improves their productivity. Headquarters also benefit from other headquarter neighbors, although such marginal scale benefits seem to diminish as local scale rises.

Item Type: Article
Official URL: http://www.journals.elsevier.com/regional-science-...
Additional Information: © 2008 Elsevier B.V.
Divisions: Geography & Environment
Subjects: G Geography. Anthropology. Recreation > G Geography (General)
H Social Sciences > HB Economic Theory
JEL classification: L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior > L20 - General
R - Urban, Rural, and Regional Economics > R0 - General
Sets: Departments > Geography and Environment
Collections > Economists Online
Date Deposited: 04 Dec 2014 11:44
Last Modified: 20 Feb 2019 09:05
URI: http://eprints.lse.ac.uk/id/eprint/52091

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