Firms often separate headquarters' (HQ) functions physically from their production facilities and construct stand-alone HQs. By locating its HQ in a large, service oriented metro area away from its production facilities, a firm may be better able to outsource service functions in that local metro market and also to gather information about market conditions for their products. However if the firm locates the HQ away from its production activity, the coordination costs in managing plant activities are increased. In this paper, we empirically analyze the trade-off between these two considerations.
|Number of pages||20|
|Journal||Journal of Urban Economics|
|Publication status||Published - 2008 Mar|
- Location decision
ASJC Scopus subject areas
- Economics and Econometrics
- Urban Studies