Analyzing firm location decisions: is public intervention justified?

• 成果类型: Article
• 署名作者: Owens, RE; Sarte, PD
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - Richmond
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/S0047-2727(01)00093-7
• 发表日期: 2002
• 页码: 223-242
• 关键词: firm migration; inertia; location subsidies

摘要

When firms can set prices, moving costs imply excess inertia in firm migration relative to the social optimum. Therefore, the idea that inducing firm relocation cannot increase welfare can be misleading. In particular, firm migration encouraged by location subsidies does not amount to a 'zero sum' across regions. However, targeting moving costs alone is not efficient, and regional planners are unlikely to produce a first best allocation. Finally, we show that relocation subsidies may give rise to significant welfare costs in the short run. (C) 2002 Elsevier Science B.V. All rights reserved.