The Localization of Interfirm Transaction Relationships

Konferenzbeitrag

Using a unique dataset of more than 140,000 manufacturing firms in Japan containing information on their suppliers and customers, this paper looks at the physical distances be- tween transaction partners to examine the localization of transaction relationships. We find the following. First, ntrols for the location of firms and their potential partners, transaction relationships in about 90-95% of the 150 three-digit manufacturing industries can be labelled as localized at distances of 40km or less. This indi- cates that physical distance is a key factor in firmsf choice of transaction partners. Second, based on a counterfactual that controls for the average distance of transaction relationships in the manufacturing sector as a whole, we find that in about 40% of industries transaction relationships are localized at short distances of up to 40km. Third, the extent of industrial localization and the extent of the localization of transaction relationships are positively cor- related. However, there are a number of exceptions and we provide potential explanations for these.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: 52nd Congress of the European Regional Science Association: "Regions in Motion - Breaking the Path", 21-25 August 2012, Bratislava, Slovakia

Classification and Topics

• Classification: Wirtschaft

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Nakajima, Kentaro ; Saito, Yukiko ; Uesugi, Iichiro
• Event: Veröffentlichung
• (who): European Regional Science Association (ERSA)
• (where): Louvain-la-Neuve
• (when): 2012

Further information

• Handle: http://hdl.handle.net/10419/120623
• Last update: 10.03.2025, 11:42 AM CET