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Public-sector financial incentives for business relocation and effectiveness measures based on company profile and geographic zone

Author

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  • Maurice Baslé

    (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique)

  • Samira Oukarfi

    (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique)

Abstract

Do public financial incentives still influence business location and relocation decisions? Examined herein will be empirical evidence drawn from three regional policies in three regions of France. This study will propose various location modeling types, both older and more contemporary cost-minimization models. We will also be proposing an empirical test to determine the effectiveness of public financial incentives for location and relocation decisions on the basis of profiles from 301 companies set up in three French regions. Our results underscore that in this case, subsidies do not trigger the dynamic of self-sustaining territorial construction. This finding proves less detrimental for core and intermediate regions than that for outlying region (like the Limousin). These results could lend confirmation to the premise that innovative companies should prefer the advantages associated with technology-based externalities, which for the most part embody tacit knowledge, in comparison with the positive perception of subsidy awards. The simple financial public location incentives from the past should be challenged anew.

Suggested Citation

  • Maurice Baslé & Samira Oukarfi, 2009. "Public-sector financial incentives for business relocation and effectiveness measures based on company profile and geographic zone," Post-Print halshs-00378789, HAL.
    • Handle: RePEc:hal:journl:halshs-00378789
    DOI: 10.1007/s00168-008-0223-1
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    Cited by:

    1. Tessa Conroy & Steven Deller & Alexandra Tsvetkova, 2017. "Interstate Relocation Of Manufacturers And Business Climate," Review of Urban & Regional Development Studies, Wiley Blackwell, vol. 29(1), pages 18-45, March.
    2. Charles Swenson, 2023. "City Business Taxes and Retail Firm Relocation Decisions," Applied Economics and Finance, Redfame publishing, vol. 10(1), pages 1-19, February.
    3. Conroy, Tessa & Deller, Steven & Tsvetkova, Alexandra, 2016. "Regional business climate and interstate manufacturing relocation decisions," Regional Science and Urban Economics, Elsevier, vol. 60(C), pages 155-168.
    4. Sharif, Naubahar & Huang, Can, 2012. "Innovation strategy, firm survival and relocation: The case of Hong Kong-owned manufacturing in Guangdong Province, China," Research Policy, Elsevier, vol. 41(1), pages 69-78.

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    More about this item

    Keywords

    size and spatial distributions of regional economic activity; production analysis and firm location; public facility location; regional development policy; government promotion of firms;
    All these keywords.

    JEL classification:

    • 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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