Choosing New Industrial Capacity: On-Site EXpansion, Branching, and Relocation

Roger W. Schmenner

The Quarterly Journal of Economics, 1980, vol. 95, issue 1, 103-119

Abstract: A manufacturing firm can increase its capacity through expansion at existing sites, opening new plants, or relocating to new, larger space. These options are in fact not very good substitutes for one another. This paper argues why one might be preferred to the others and supports its view of the capacity choice with detailed evidence from over 400 plants in New England.

Date: 1980
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