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Relocation in conditions of uncertainty: the Spanish automobile components industry during the economic crisis (2008-2012)

Jesús F. Lampón

MPRA Paper from University Library of Munich, Germany

Abstract: This paper analyses production relocation patterns in conditions of uncertainty. Analysis of the Spanish automobile components industry during the recent economic global crisis shows that the number of relocations was comparatively lower than in the period before the crisis. Uncertainty weighs more than the advantages derived from the operational flexibility of multinationals in relocation decisions. The main drivers of relocation in the sector are the search for lower labour costs and corporate restructuring. When there is uncertainty, these are conditioned by relocation costs and the risks inherent in such processes. The main implication of the research is that it helps identify the vulnerability of a region in relocation processes. This is key for defining public policies to prevent relocation and avoid its impact on regions that have traditionally suffered such processes.

Keywords: Production relocation; location theory; automotive industry; economic crisis; uncertainty (search for similar items in EconPapers)
JEL-codes: F23 M16 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-geo
Date: 2019-03-13
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