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Where do manufacturing firms locate their headquarters?

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  • Henderson, J. Vernon
  • Ono, Yukako

Abstract

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.

Suggested Citation

  • Henderson, J. Vernon & Ono, Yukako, 2008. "Where do manufacturing firms locate their headquarters?," Journal of Urban Economics, Elsevier, vol. 63(2), pages 431-450, March.
    • Handle: RePEc:eee:juecon:v:63:y:2008:i:2:p:431-450
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    References listed on IDEAS

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    6. Ono, Yukako, 2003. "Outsourcing business services and the role of central administrative offices," Journal of Urban Economics, Elsevier, vol. 53(3), pages 377-395, May.
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    More about this item

    Keywords

    Headquarters Coordination Location decision Manufacturing;

    JEL classification:

    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • R0 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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