In this paper we study how neighbourhood‐related spillovers affect location choices of manufacturing firms at a local level. A spatial Dirichlet‐multinomial regression model is applied to 90,000 new establishments of the Spanish Mediterranean Axis. Empirical findings show that spatial spillovers play an important role, together with traditional explanatory factors, in driving decisions of companies. Their size and scope depends on two main issues, the specific characteristics of the manufacturing industry the firm belongs to, and the accessibility of the urban environment where the firm is located.
Focusing on the characteristics of destinations, we seek to identify the relevance of spatial spillovers while driving location choices of manufacturing and services fi rms. With this objective, we apply a spatial conditional logit equation to model empirically the behaviour of 1 092 864 fi rms established in 316 municipalities of the Spanish Mediterranean Arc during the period 1998-2008. Our econometric specifi cation allows us to identify both types of external spatial eff ects, direct or locally bounded, and indirect or associated-neighbourhood spatial eff ects. Further, we propose a broad indicator of spatial spillovers generated by a given destination. Empirical fi ndings show that spatial spillovers generated by destinations have greater impacts on the location decisions of manufacturing companies compared with those of services. When we break down the sample by technological intensity of activities, we observe that spatial spillovers are more willing to aff ect decisions of knowledge-intensive companies relative to those of less knowledge-intensive ones, which stay more locally bounded.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.