This study analyses determinants of business relocation and identifies regional characteristics which attract relocating firms. Results indicate that the relocation decisions of firms are sector‐dependent, and the migratory behaviour of firms in knowledge‐intensive sectors notably differs from that in less knowledge‐intensive sectors. Predominantly low‐tech and medium‐low‐tech manufacturing and less knowledge‐intensive service firms paying high average salaries have a higher probability to move out of their present location. For less knowledge‐intensive service firms, the average municipal wage negatively affects their propensity to relocate, while those located in municipalities with high sector‐specific wages have an increased likelihood to move. Relocating firms are generally attracted by densely populated municipalities with high wage levels, and primarily service firms are drawn to municipalities which are specialized in the firm's own sector and appeal to individuals. Sector‐specific wages may either attract, or deter firms, suggesting that this variable may capture both the cost and the quality of the locally available workforce.

This study identifies and evaluates determinants of employees’ job and residential mobility. It examines the mobility of full-time employees in selected sectors in 2003/04, using register data for the Netherlands. A multinomial model of job and residential change is estimated. The results illustrate how individuals decide upon changing jobs and/or relocating by taking into account the strength of family- and job-related ties, career opportunities within and outside the firm, and attachment to the present dwelling. A long commuting distance was found to encourage both job and housing mobility, often simultaneously. Employees living/working in large cities are prone to change jobs, or to relocate. The influence of human capital indicators on mobility was found to be highly sector-dependent.

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