The impact of firm-type dominance on regional manufacturing growth

Salvary, Stanley (2007): The impact of firm-type dominance on regional manufacturing growth.

Abstract

Availability of financial capital and location decisions are variables that influence regional manufacturing output. This study maintains that a region’s manufacturing growth depends upon the region’s firm-type dominance. That is, the type of firms that dominate the region’s manufacturing output can be classified as non-local (national or foreign - NF) vs. local and large vs. small. Accordingly, for policy analysis, regions can be classified by firm-type dominance. This distinction is important since, invariably, location decision options and availability of financial capital are more favourable for the larger NF firms than for local firms. In an attempt to assess the impact of firm-type dominance, this study draws upon the dominant industry model which has established that, in any given region, there is a dominant industry (the driving force of the region) to which a region’s manufacturing growth is linked. The information on the impact of firm-type dominance on a region's manufacturing output may enable policy-makers to design workable (or revise existing) manufacturing diversification policies.

• Item Type: MPRA Paper
• Language: English
• Keywords: state-regions and industry-regions; chemical industry region; regional policy analysis; manufacturing growth; firm-type dominance; availability of financial capital; dominant industry model; manufacturing firms' location decisions; regional economic development; foreign-owned manufacturing plants
• Subjects: R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R12 - Size and Spatial Distributions of Regional Economic Activity; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R11 - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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