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Choosing New Industrial Capacity: On-Site EXpansion, Branching, and Relocation

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  • Roger W. Schmenner

Abstract

A manufacturing firm can increase its capacity through expansion at existing sites, opening new plants, or relocating to new, larger space. These options are in fact not very good substitutes for one another. This paper argues why one might be preferred to the others and supports its view of the capacity choice with detailed evidence from over 400 plants in New England.

Suggested Citation

  • Roger W. Schmenner, 1980. "Choosing New Industrial Capacity: On-Site EXpansion, Branching, and Relocation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 95(1), pages 103-119.
    • Handle: RePEc:oup:qjecon:v:95:y:1980:i:1:p:103-119.
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    File URL: http://hdl.handle.net/10.2307/1885351
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    Cited by:

    1. Antonin Bergeaud & Simon Ray, 2021. "Adjustment Costs and Factor Demand: New Evidence from Firms’ Real Estate [The heterogeneous impact of market size on innovation: evidence from French firm-level exports]," The Economic Journal, Royal Economic Society, vol. 131(633), pages 70-100.
    2. Karl-Peter Schackmann-Fallis, 1989. "External Control and Regional Development within the Federal Republic of Germany," International Regional Science Review, , vol. 12(3), pages 245-261, December.
    3. David L. Barkley & Kevin T. McNamara, 1994. "Manufacturers' Location Decisions: Do Surveys Provide Helpful Insights?," International Regional Science Review, , vol. 17(1), pages 23-47, April.
    4. Lee, Yoonsoo, 2008. "Geographic redistribution of US manufacturing and the role of state development policy," Journal of Urban Economics, Elsevier, vol. 64(2), pages 436-450, September.
    5. Joris Knoben, 2006. "A Relational Account of the Causes of Spatial Firm Mobility," ERSA conference papers ersa06p1, European Regional Science Association.
    6. Pan, Xian & Yu, Lihong, 2024. "Do China's pilot emissions trading schemes lead to domestic carbon leakage? Perspective from the firm relocation," Energy Economics, Elsevier, vol. 132(C).
    7. Meri Davlasheridze & Pinar C. Geylani, 2017. "Small Business vulnerability to floods and the effects of disaster loans," Small Business Economics, Springer, vol. 49(4), pages 865-888, December.
    8. Brouwer, Aleid & Mariotti, Ilaria & van Ommeren, Jos, 2002. "The firm relocation decision: a logit model," ERSA conference papers ersa02p205, European Regional Science Association.
    9. repec:rre:publsh:v:38:y:2008:i:1:p:67-88 is not listed on IDEAS

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