Location Decisions and Agglomeration Economies: Domestic and Foreign Companies

Enrique Claver-Cortés (), Bartolome Marco-Lajara (), Encarnación Manresa-Marhuenda (), F. García-Lillo () and Pedro Seva-Larrosa ()
Additional contact information
Enrique Claver-Cortés: University of Alicante
Bartolome Marco-Lajara: University of Alicante
Encarnación Manresa-Marhuenda: University of Alicante
F. García-Lillo: University of Alicante
Pedro Seva-Larrosa: University of Alicante

INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, 2017, issue 39, 99-135

Abstract: The international expansion of multinational enterprises (MNEs) is one of the topics most frequently discussed amongst international business scholars. In particular, decisions regarding firm location and its effects on performance have received great attention. The results obtained in the study about this relationship are inconclusive, though, since a large number of studies have been conducted from very different perspectives. One of these perspectives suggests that the location in agglomerations allows MNEs to benefit from potential knowledge spillovers encouraging innovation and local adaptation. However, this co-location increases the risk of imitation by domestic companies as well. Furthermore, the acquisition by each firm of the external knowledge generated by means of concentration depends on its internal capabilities, and especially on its absorptive capacity. The aim sought with this work consists in analyzing the location decisions adopted by MNEs in an attempt to clarify the following issues: Are MNEs more likely to be established in agglomerations? Which companies benefit the most from geographical proximity in terms of innovation, domestic or foreign ones? What is the role of absorptive capacity? The results obtained in the analysis, carried out with a sample of firms and using data from a survey conducted in 2013 by PITEC, reveal the differences between foreign and local companies when it comes to using external knowledge.

Keywords: location choice; multinational enterprise; innovation; agglomeration; knowledge; absorptive capacity (search for similar items in EconPapers)
JEL-codes: D83 F23 L25 M16 R30 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://investigacionesregionales.org/wp-content/up ... 05-CLAVER-CORTES.pdf Full text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ris:invreg:0358

Access Statistics for this article

INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH is currently edited by Vicente Royuela Mora

More articles in INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH from Asociación Española de Ciencia Regional C/ Viladomat, 321 entresuelo - 08029 Barcelona, Teléfono y Fax: + 34 933101112, E-mail: info@aecr.org, Web: www.aecr.org, Web Investigaciones Regionales: www.investigacionesregionales.org. Contact information at EDIRC.
Bibliographic data for series maintained by IIRR-JORR ().