Should I Stay or Should I Go: Predicting Advanced Producer Services Firm Expansion and Contraction

Zachary P. Neal, Ben Derudder and Peter J. Taylor

International Regional Science Review, 2019, vol. 42, issue 2, 207-229

Abstract: The literature on firm location selection allows us to retrospectively explain why firms did locate in particular places. However, it remains challenging to prospectively predict where they will locate. In this article, we propose a simple conceptual model of firm location decisions, then operationalize it using the ordinal stochastic degree sequence model (oSDSM). We use this model to predict whether 104 advanced producer service firms will expand, contract, or maintain their presence in each of 525 cities, and find that these predictions are accurate in more than 86 percent of cases. We conclude with suggestions for further refinement of this model.

Keywords: location models; spatial analysis; methods; city size and city systems; urban and regional spatial structure; spatial structure; producer services; stochastic degree sequence model; world cities (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:sae:inrsre:v:42:y:2019:i:2:p:207-229

DOI: 10.1177/0160017618784739

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