Determinants Of Location Choice Research Articles

Urban hotel location determinants: Evidence from Ankara's hotel geography

This paper argues that urban hotels have different characteristics and make location decisions based on this differentiation, which in turn affect to the urban spatial structure. To this end, the study examines the determinants of location choices of hotels and their spatial distribution in Ankara. A sample of 75 hotels operating in Ankara was selected through criterion sampling method and applied a questionnaire to identify their location determinants. Findings suggest that hotels with differentiated characteristics show variations in making their location choice, which leads to a shift in gravity of the city and promotes spatial segregation among the central districts of the city. The overall assessment provides evidence on the increasing importance of the new development districts in hotel locations and the decreasing role of old town in the market competition which necessitates the development of local policies targeting the improvement of central district with the lens of hotel geography. Verification of the hypothesis by the case study will fill the gap in literature that has not yet been addressed in Turkey's cities context in the framework of the planning discipline.

What determines China’s energy OFDI: Economic, geographical, institutional, and cultural distance?

This paper aims to study the determinants of location choice of China's direct energy investment in BRI countries. It also attempts to analyze the impact of the Belt and Road Initiative on the effect of national distance. For this purpose, the gravity model is applied to the data over the period 2003–2017. The main results show that economic distance, geographical distance, and institutional distance hinder the location choice of China's OFDI in the energy sector, but the effect of cultural distance is uncertain. Second, the Belt and Road Initiative has increased China's direct energy investment in BRI countries but has not changed the influence of national distance on location choice significantly. Furthermore, renewable energy is attracting investment from Chinese firms in developed countries. Finally, the paper makes suggestions on strengthening the institutional quality of the host country, building energy pipelines, strengthening the cooperation of renewable energy, and enhancing the diversity of investment choices.

Where are craft breweries located? The role of agglomeration, tourism, and know-how

The objective of this article is to identify main drivers determining the geographical location of craft breweries in Slovakia. The main contribution of the article to the literature is to provide empirical evidence on the location determines of small firms as well as the focus on the Eastern European country both of which are less explored in the literature. The article employs a conditional logit model on a regional panel data dataset of craft breweries and location attributes covering 79 counties in Slovakia for the period 1995–2019. The estimated results suggest that agglomeration economies are key determinants of location choices. However, the agglomeration of small breweries has notably strong effect, while the agglomeration of large breweries and past brewing experience are statistically insignificant in affecting location choices. Further, important drivers of craft breweries location choices are demand factors linked to tourist sector development. Other drivers, such as urban effects, life quality and labour market conditions, seem not to play role or have rather a weaker impact.

Understanding location choice of Syrian refugees from country to neighbourhood level: Opportunities, restrictions and expectations

This study aimed to delve into distinct strands of the location choice (LC) of Syrian refugees by uncovering its determinants at country, city and neighbourhood levels from the narratives, along with the help of content analysis. Findings providing an aggregate explanation of the Syrian emplacement process revealed that Syrian refugees in Turkey, as active agents in the process, make their destination choices within opportunities and restrictions of different scales through the contribution of other agents, places and processes. Findings emphasizing time- and context-specific features - the transitivity, interrelatedness and multi-dimensionality (legal, economic, socio-cultural and spatial) of determinants of LC - showed that the opportunities and restrictions of LC influence Syrians’ future expectations.

Research versus development: global cities and the location of MNCs’ cross-border R&D investments

ABSTRACT Large, internationally connected cities are important hubs of innovative activity, yet research on the attractiveness of such ‘global’ cities for research and development (R&D) activities by multinational corporations (MNCs) is scarce. We posit that factors determining cities’ potential to attract R&D investments by MNCs differ depending on the type of R&D investments: research or development. We investigate the heterogeneous determinants of location choices for 1537 cross-border R&D investments by 633 MNCs in 55 global cities during the period 2003–12. The findings suggest that cities’ technological and university strengths are stronger attracting factors for research activities, while global cities’ market potential and intellectual property rights protection attract investments in development activities. Implications are discussed.

Inward Foreign Direct Investments (FDI) and Location Choice Determinants: Empirical Evidence from India

The main purpose of this research was to determine the nature of the relationship between inward FDI flow into India and selected sets of FDI location determinants. The paper also investigates the exact impact of the individual FDI location determinants on inward FDI flow into India. Following these objectives, eight variables relating to the inward FDI locational advantage theory were selected, with data running from 1965-2018. The investigated location determinants for inward FDI include tax, market size (GDP), a measure of market potential (GDPPC), human capital (education), wage cost, Ease of Doing Business (DB), and measure of economic progress (GDP growth). The method of data analysis involved the application of OLS regression, taking note of the necessary assumptions for the use of OLS. The results of the study indicate that GDP growth is the only significant FDI location determinant in India, with a positive impact of about 0.57. This implies that the Indian government should prioritise policies that seek to boost GDP

Renters vs owners: The impact of accessibility on residential location choice. Evidence from Lyon urban area, France (1999–2013)

Urban areas face important challenges linked to contradictory trends of concentration, urban sprawl and segregation. More and more people choose to buy a residence in the suburbs taking advantage of the accessibility increase. At the same time, young households choose to rent in central areas. In this paper, distinguishing between renters and owners, we investigate the evolution of the households’ location choice determinants over time with a special focus on accessibility to employment. Our case study is the Lyon urban area. We rely on discrete choice models using the disaggregated census data of the location choices of households from 1999, 2008 and 2013 and we calculate elasticities. The results confirm our initial intuition. Owners become less sensitive to accessibility to employment over time whereas it is the opposite for renters. Our results suggest the importance of incorporating these temporal evolutions into models for a better land-use transport integration and policy.

Location choice determinants of Chinese and US firms in Africa: Does spatial interdependence play a role?

AbstractIn an increasingly integrated global market, the nature and extent of spatial interdependence is one key factor influencing firms’ location decisions. Spatial interdependence often manifests itself in the form of agglomeration or congestion effects, not just within a country but also in a region. Using Chinese and US overseas investment data, this study presents empirical evidence on the role that neighbouring countries (third‐country effects) play in attracting Foreign Direct Investment (FDI) to a host country. The study's findings show that there is evidence of spatial interdependence both for Chinese and USA FDI flows to African countries. For both countries, the third country effects come through either explanatory variables (including market size, domestic credit, trade costs and the share of service sector), error term or the amount of FDI in neighbouring countries. The findings also show that there is more robust evidence that, unlike Chinese FDI, the US FDI takes into account the market potentials of not just a host country but also that of a neighbouring country in making investment location decisions.

Patterns and determinants of location choice in residential mobility: A case study of Shanghai

Patterns and determinants of location choice in residential mobility: A case study of Shanghai

INDIAN INVESTMENT IN CHINESE PROVINCES: SPATIAL DISTRIBUTION, LOCATIONAL DETERMINANTS, CHALLENGES AND IMPLICATIONS

The paper empirically examines Indian investment in China and its spatial distribution across 17 Chinese provinces during 2005–2015. Indian investments in China have spread across heterogeneous provinces. The location of ventures has been shaped by several provincial characteristics and locational advantages that include infrastructural facilities, lower wages, markets and openness; economic geography forces that include agglomeration of foreign and private firms and policies and engagements of the local governments. As such multiple determinants of location choice can be observed, which provide insights into the locational determinants of firms from one emerging country in another. Chinese inland provinces trying to attract Indian investment need to focus on developing locational advantages at par with the coastal regions and on economic geography. However, the scale of operation of Indian companies in China remains smaller due to several China-specific challenges. Industrial bodies and investment promotion agencies may aid in building firm-capacity to deal with China-specific challenges, with adequate emphasis on the spatial characteristics of provinces, to overcome business challenges. The increase in Indian investment in China shall be beneficial provided the firms and their activities generate complementarity in the bilateral economic relationship between the two countries and in the product and factor markets.

Catch shares drive fleet consolidation and increased targeting but not spatial effort concentration nor changes in location choice in a multispecies trawl fishery

Catch share systems are generally expected to increase economic rents in fisheries by increasing harvest efficiency, reducing capital costs through consolidation, and increasing the value of landed catch. However, these benefits may have costs, as consolidation and the potential for associated change in spatial distribution in landings can hinder social objectives such as maintaining access for fishery-dependent communities and small owner-operators. Achievement of such fishery management objectives are determined by changes in fisher behavior, which may be complex and difficult to predict. Predicting fisher behavior is particularly challenging in multispecies fisheries, in which the mix of species is a determinant of where and when fishing effort and landings occur. We evaluate changes in overall fishing effort, species targeting, and determinants of fishing location choice in response to catch shares in the US West Coast Groundfish Trawl Fishery. We found reductions in total fishing effort, increased targeting of some species, and no evidence of spatial effort concentration. Key determinants of location choice (distance, expected revenue, and recently fished locations) were similar among time periods, but after catch shares there was more avoidance of areas that lacked recent fishing activity or associated information with which to develop expectations of catch and bycatch. Additionally, location choice remained constant with up to 100-fold financial penalties on bycatch species.

The determinants of location choice

Purpose– The purpose of this paper is to analyze the role of institutional distance and host country attractiveness in location determinants of Chinese Foreign investments in EU in the renewable energy sector, taking into account bilateral political and economic relations.Design/methodology/approach– A firm-level Ministry of Commerce (MofCom) database of greenfield and non-greenfield Chinese investments abroad is used. A six fixed-effects logit analysis is performed.Findings– Chinese firms tend to invest in EU countries with reduced rule of law; market affluence is an attraction factor for them, but they do not seem to be human capital asset-seekers. Countries with politically stable environment are most attractive to sales/services subsidiaries; while countries with good control of corruption, low trade barriers and encouraging foreign ownership are most attractive to manufacturing subsidiaries. A large market is the most attractive factor for R & D subsidiaries, and a rich market is the most attractive factor for manufacturing subsidiaries. Manufacturing subsidiaries are more technological asset-seekers. R & D subsidiaries are the most non-human capital asset-seekers.Research limitations/implications– The study extends the state of the art of the literature by developing a theoretical framework, grounded on the influence of host country institutional factors and on endowment of resources on the location choice of Chinese investors. Further variables should be included in the future (industrial specialization of host country, cultural distance, bilateral ties).Practical implications– Policy implications are relevant. They are related both to outward foreign direct investment attraction policies and to Europe-China cooperation dialogue. With reference to attraction policies, as Chinese green firms are technological asset-seekers, more than human capital asset-seekers, EU countries interested in partnering with Chinese investors should develop specific measures targeting encouraging technology spillover. Even R & D subsidiaries should be tempted with technology-oriented measures. With reference to Europe-China cooperation, the paper findings support suggestions for a more active European position on foreign investments in key European energy sectors.Originality/value– The paper is grounded on an improved theoretical model, tested through a unique Mofcom firm-level database. Originality lies in the fact that the authors provide a sectoral insight. The need for sectoral analysis is fundamental as Chinese industrial development and internationalization path vary extensively across industry, due to policy interventions, supportive measures and prioritized initiatives. Zhanget al.(2011, p. 229) found that – specifically – the energy sector is highly sensitive to host country institutional context, therefore Chinese foreign direct investment are more likely to be exposed to regulatory and competitive pressure compared to other industries.

Japanese production networks in India: spatial distribution, agglomeration and industry effects

This paper examines the determinants of subnational location choice of Japanese multinational enterprises (JMNEs) in India to investigate whether or not conventional investment behaviour as ‘foot-loose’ and one-off investments has given way to an agglomeration logic as Japanese foreign direct investment has intensified. Using geographic information system analysis of investment project numbers, we find that Japanese MNE behaviour in India is evolving, with complementing but complex subnational interactions of economic, institutional and infrastructure factors serving as strong determinants of location choice consistently across key phases of India’s liberalization. We argue that Japanese investment decisions in India have followed a self-reinforcing dynamic whereby prior investments indeed attract further investment.

Two traditional questions on the relationships between telecommuting, job and residential location, and household travel: revisited using a path analysis

This study aims to provide empirical evidence for two traditional research questions in the field of telecommuting studies: (1) Does telecommuting promotes dispersion of urban space? (2) Does telecommuting substitute for household travel? Although these causality issues have received great deal of attention, no multivariate analysis approaches exist. Using the 2006 household travel survey data from the Seoul Metropolitan Area, this study adopts a path analysis to discover the complex relationships between telecommuting, residential/job locations, and household travel. First, the path analysis shows that rather than telecommuting serving as the determinant of location choice, job locations determine the choice to telecommute. Hence, secondary impacts of telecommuting on travel may not occur with location changes as the medium. Second, the analysis also shows that the household head’s telecommuting has a positive influence on his/her non-commuting travel in both the person kilometers traveled (PKT) and vehicle kilometers traveled (VKT) models and on household members’ travel in VKT models. Moreover, the VKT model suggests that the household head’s non-commuting travel has a negative impact on the household members’ travel. These results indicate that although telecommuting reduces commute travel, this may be offset by other travel demand within the household, owing to exhaustion of the limited travel budget. Thus, planners and policymakers must consider these impacts when evaluating the benefits and costs of telecommuting as an urban management policy.

Globalization, Economic Restructuring, and Locational Trajectories of Software Firms in Shanghai

Producer services are traditionally considered as place-bound and clustered in city centers to benefit from agglomeration effects. Such a pattern has been reshaped, however, by the decentralization of the service industry and the development of information and communication technology (ICT), especially for the software industry. This study investigates locational trajectories and underlying factors of software firms from 1990 to 2011 in Shanghai to detect intraurban location trajectories and spatial dynamics. We find that location of the software industry has changed from a monocentric pattern concentrated in the central city area toward a polycentric pattern with a relative decline of the core area. Using a conditional logit model, the study has found that government policies, accessibility, environmental conditions, agglomeration economies, and site characteristics are important determinants of location choice for software firms. In addition, the firm-level survey and in-depth interviews in Pudong Software Park show that government policy and planning, especially rent and tax incentives, have played a vital role in attracting software firms to locate in development zones.

Economics Institutions and the Outward FDI Location Strategies of Emerging Market Multinational Business Groups: Evidence from Central and Eastern European Countries

Using an extensive data set on the Outward Foreign Direct Investment (OFDI) projects from Central and Eastern European Countries (CEEC), this study empirically examines the impacts of host country economic institutions, including property rights protection, corruption, taxation, business operating regulations and economic stability, on firms' location decisions in the European Union (EU), while controlling for other conventional determinants of location choice. From a data set of 24,726 location decisions of 951 firms for a time period from 1995 to 2010, the robust empirical evidence suggests that a corruption-free country with a lower tax burden and friendly business regulations positively influence the OFDI location choice strategies of CEEC multinationals. However, these factors vary depending on whether the host country has an advanced economy (EU15: original member countries of the EU), or an emerging economy (CEEC). The effects of economic institutions are more profound on the location activities in the advanced economies of the EU than in other CEEC. Furthermore, CEEC investors generally prefer to be located in countries that have better institutions than their home countries.

Chinese foreign direct investment in the United States: Location choice determinants and strategic implications for the State of Indiana

Identifying the unique U.S. state-level factors that more often give rise to Chinese firm-led investment is the central focus of this article. Looking at Chinese investment in the United States between 2007 and 2011, this article (1) explores the determinants underlying the locational choices of Chinese firms, (2) seeks to understand why some U.S. states receive relatively greater amounts of investment from China, (3) assesses whether prior trends are likely to continue into the future; and—perhaps most importantly—(4) seeks to identify what (if anything) the state of Indiana can do to better position itself to capture greater amounts of Chinese investment moving forward. We recommend the following actions for the state of Indiana: (1) firm targeting—Indiana is a prime FDI target for private, firm-led, greenfield investment; (2) differentiation— Indiana has distinct advantages over other locations in the Midwest; (3) promotions—trade missions and overseas office locations are investments, not costs; (4) investments in relationships—cultural sensitivity and friendship make the difference.

Emerging market multinationals' location choice

PurposeLocation choice made by emerging market multinationals (EMMs) constitutes an important yet somewhat neglected topic in business research. The purpose of this paper is to develop a research framework that elucidates the role of EMM‐specific resources and internationalization motivations on the location choice of EMMs.Design/methodology/approachThe literature pertaining to firm‐specific resources and internationalization motivations as determinants of location choice is reviewed. This leads to the development of a research framework that takes into account various combinations of resources and motivations in explaining the location choice of EMMs. The paper offers research propositions by linking resources, motivations, and the appropriate choice of locations.FindingsThe paper illustrates that location choices of EMMs are determined by the interplay of various resources (relationship‐based, home experiences‐based, and country created assets‐based) and internationalization motivations (market‐seeking, asset‐seeking, and resource‐seeking).Originality/valueThe paper investigates the simultaneous influence of two important determinants: firm‐specific resources and internationalization motivations on the location choices of EMMs. Prior literature has extolled the importance of these factors in international business but not in the context of the location choices of EMMs. Thus, this paper fills an important void in business scholarship.

The Global Economic Crisis and Foreign Investment in Russia from the EU: Empirical Evidence from Firm-Level Data

This paper empirically examines the impact of the recent global economic crisis on foreign investment from EU countries in Russia by estimating a location choice model for foreign firms' entry in Russian regions for the period 1997-2011. It also examines the relative importance of various determinants of location choice on the redistribution of foreign-owned firms among Russian regions before and after the crisis. Strong evidence during the post-crisis period (2008-2011) of a decrease in market-seeking foreign investment in manufacturing and resource-seeking foreign investment in trade is examined not only in light of the crisis but also (in the latter case) within the context of the new Russian law for foreign investment in strategic industries, which went into effect in 2008.

Residential Characteristics of Armed-Forces Personnel and the Urban Economy: Evidence from a Medium Sized City in Greece

Residential Characteristics of Armed-Forces Personnel and the Urban Economy: Evidence from a Medium Sized City in GreeceThe paper explores the locational and residential decisions of Greek military households. To achieve this, primary data were collected by means of a questionnaire survey addressed to military personnel located in Volos, a medium-sized Greek city in the greater area of which a number of major military facilities are located. The study starts by examining the residential distribution of military households to consider whether clustering or dispersion is evident. Then, an attempt is made to explain the observed pattern with reference to conventional urban economics' determinants of location choice or to other factors related to the social or professional characteristics of the group. Such analysis enables us to draw some preliminary conclusions on the potential effects military facilities have on both the urban spatial structure and the housing market.