Firm location choice in cities: Evidence from China, India and Brazil

Arbeitspapier

We use large survey data sets of firms provided by the World Bank for China, India, and Brazil—Investment Climate Surveys—to address the important question: what determines the locational choice of firms among cities in these countries. We find that capital cities in all countries are attractive for firms to locate. In India and China, labour-intensive firms tend not to locate in mid-sized or large cities, when compared with smaller ones, perhaps due to higher wage, training and attrition costs. Labour regulations both in India and China deter firms from locating in the larger cities, but not in Brazil. Exporter firms prefer to locate in large cities in these two countries, but not so in the largest cities of Brazil. Finally, while the size of a firm has no impact on its location decision in China, large firms in India prefer to locate in the largest cities, but not in mid-sized cities. Proximity to inputs within the city has a positive impact on firm location. The post-reform firms in China tend to locate in the large cities whereas in the case of India, post-1991 firms refrain from locating in the mid-sized or large cities. These findings have important policy implications for urban governance in these countries, which are summarized in the paper. – India ; China ; Brazil ; location choice ; industry location ; firm location

Object Details

• ISBN: 978-92-9230-003-6
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: WIDER Research Paper ; No. 2007/56

Classification and Topics

• Classification: Wirtschaft ; Comparative Studies of Particular Economies ; Size and Spatial Distributions of Regional Economic Activity ; Regional Development Planning and Policy
• Subject: Betriebliche Standortwahl ; Stadt ; China ; Indien ; Brasilien

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Sridhar, Kala Seetharam ; Wan, Guanghua
• Event: Veröffentlichung
• (who): The United Nations University World Institute for Development Economics Research (UNU-WIDER)
• (where): Helsinki
• (when): 2007

Further information

• Handle: http://hdl.handle.net/10419/63441
• Last update: 10.03.2025, 11:42 AM CET