What Factors Affect Information Technology Firm Location Choices in Middle America? An Examination of Regional and Industrial Variation in Kansas

Abstract

The importance of information technologies in regional economic performance is widely accepted but only widely studied in more populous regions in the United States. Local and state development practitioners and policy makers actively court and promote Information Technology (IT)—intensive industries in rural areas. Despite various promotional efforts, relatively little is known about the specific location requirements of such industries, however, especially in lower population areas of the United States such as the mostly rural Midwest. In this article, the authors examine the location choice preferences of firms in three IT industry sectors in metro, metro-adjacent, and nonmetro regions using a highly detailed data set of Kansas industries. The modeling framework combines both conditional logit and Poisson regression models. The results indicate that average establishment size, industry clustering, labor intensity, and county employment growth explain variations in industry location choice preferences across regions.

Should I Stay or Should I Go: Predicting Advanced Producer Services Firm Expansion and Contraction

“…Under ideal circumstances, firms seek to locate in the optimal location(s), making the location selection process a game of matching the right firms to the right locations (Nakamura 2018). Viewed in this simplified way, the vast majority of factors identified by past studies of multinational firm locations (e.g., Barrios, Görg, and Strobl 2006; Cader, Crespi, and Leatherman 2011) and of firm managers’ location decision process (e.g., Barkley and McNamara 1994; Elgar and Miller 2010) can be grouped under two broad headings: firm factors and location factors.…”

“…As a result, a vast literature has developed that has been synthesized by numerous theoretical and empirical reviews (e.g., Bhutta 2004; Blair and Premus 1987; Brown 1979; Buss 2001; Devereux and Griffith 2002; Melo, Nickle, and Saldanha-da-Gama 2009; Owen and Daskin 1998; Snyder 2006). Contemporary studies of firms’ location decisions often focus on pinpointing the effect of ever-narrower factors (e.g., Barkley and McNamara 1994; Barrios, Görg, and Strobl 2006; Cader, Crespi, and Leatherman 2011; Elgar and Miller 2010). From these reviews and highly targeted empirical studies, we now know a great deal about a wide range of factors that influence location decisions, including taxation, labor markets, accessibility, amenities, and agglomeration economies.…”