Urban Vibrancy and Corporate Growth

Casey Dougal, Christopher A. Parsons and Sheridan Titman

Journal of Finance, 2015, vol. 70, issue 1, 163-210

Abstract: type="main">

We find that a firm's investment is highly sensitive to the investments of other firms headquartered nearby, even those in very different industries. A firm's investment also responds to fluctuations in the cash flows and stock prices (q) of local firms outside its sector. These patterns do not appear to reflect exogenous area shocks such as local shocks to labor or real estate values, but rather suggest that local agglomeration economies are important determinants of firm investment and growth.

Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:bla:jfinan:v:70:y:2015:i:1:p:163-210

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