Impact of Transport Infrastructure on Firm Formation: Evidence from Portuguese Municipalities
Abstract
This paper investigates the relationship between the availability of transport infrastructure and new plant openings in Portugal. The paper estimates an econometric model that uses plant-level data and geographic information systems to test whether denser motorway and railway networks have a positive effect on the formation of firms in Portuguese municipalities for various sectors of the economy. In addition to a study of the role of the own-municipality transport infrastructure, tests for the presence of spatial spillovers from the transport infrastructure were also conducted. The results suggest that both the railway and the motorway networks act as determinants of new plant openings. Expanding the local municipality railway and motorway networks by 10% can produce an increase in new plant openings from 0.9% to 2.7% and 0.7% to 2.6%, respectively. Positive spatial spillover effects from the transport infrastructure were also found: improving the motorway and railway networks of neighboring municipalities by 10% increases plant openings by from 2.7% to 5.1% and 2.4% to 6.7%, respectively.
Get full access to this article
View all access and purchase options for this article.
References
1. Smith D. M. Industrial Location: An Economic Geographical Analysis. John Wiley and Sons, Inc., New York, 1971.
2. Goodall B. The Economics of Urban Areas. Pergamon Press, Oxford, United Kingdom, 1972.
3. McCann P. Urban and Regional Economics. Oxford University Press, Oxford, United Kingdom, 2001.
4. McCann P. Classical and Neoclassical Location–Production Models. In Industrial Location Economics, Edward Elgar, Cheltenham, United Kingdom, 2002.
5. von Thunen J. H. Der Isolierte Staat in Beziehung auf Landwirtschaft und Nationalökonomie. Perthes, Hamburg, Germany, 1826. (English translation, The Isolated State. Pergamon Press, Oxford, United Kingdom, 1966.)
6. Weber A. Über den Standort der Industrie. J. C. B. Mohr, Tubingen, Germany, 1909. (English translation, The Theory of the Location of Industries. Chicago University Press, Chicago, Ill., 1929.)
7. Eberts R. W., and McMillen D. P. Agglomeration Economies and Urban Public Infrastructure. In Handbook of Regional and Urban Economics. Elsevier Science B.V., Amsterdam, Netherlands, 1999.
8. Fujita M. M., Krugman P., and Venables A. J. The Spatial Economy—Cities, Regions and International Trade. The MIT Press, Cambridge, Mass., 1999.
9. Reynolds P. Autonomous Firm Dynamics and Economic Growth in the United States, 1986-1990. Regional Studies, Vol. 28, 1994, pp. 429–442.
10. Audretsch D., and Fritsch M. The Geography of Firm Births in Germany. Regional Studies, Vol. 28, 1994, pp. 359–365.
11. Davidsson P., Lindmark L., and Olofsson C. New Firm Formation and Regional Development in Sweden. Regional Studies, Vol. 28, 1994, pp. 395–410.
12. Reynolds P., Storey D., and Westhead P. Cross-National Comparisons of the Variation in New Firm Formation Rates. Regional Studies, Vol. 28, 1994, pp. 443–456.
13. Guesnier B. Regional Variations in New Firm Formation in France. Regional Studies, Vol. 28, 1994, pp. 347–358.
14. Hart M., and Gudgin G. Spatial Variations in New Firm Formation in the Republic of Ireland, 1980-1990. Regional Studies, Vol. 28, 1994, pp. 367–380.
15. Keeble D., and Walker S. New Firms, Small Firms and Dead Firms: Spatial Patterns and Determinants in the United Kingdom. Regional Studies, Vol. 28, 1994, pp. 411–427.
16. Garofoli G. New Firm Formation and Regional Development: The Italian Case. Regional Studies, Vol. 24, No. 8, 1994, pp. 381–393.
17. Kangasharju A. Regional Variations in Firm Formation: Panel and Cross-Sectional Data Evidence from Finland. Papers in Regional Science, Vol. 79, 2000, pp. 355–373.
18. Berglund E., and Brännäs K. Plants' Entry and Exit in Swedish Municipalities. Annals of Regional Science, Vol. 35, No. 3, 2001, p. 431.
19. Armington C., and Acs Z. J. The Determinants of Regional Variation in New Firm Formation. Regional Studies, Vol. 36, No. 1, 2002, pp. 33–45.
20. Sutaria V., and Hicks D. A. New Firm Formation: Dynamics and Determinants. Annals of Regional Science, Vol. 38, 2004, pp. 241–262.
21. Smith D., and Florida R. Agglomeration and Industrial Location: An Econometric Analysis of Japanese-Affiliated Manufacturers in Automotive-Related Industries. Journal of Urban Economics, Vol. 35, 1994, pp. 1–19.
22. Coughlin C. C., and Segev C. E. Location Determinants of New Foreign-Owned Manufacturing Plants. Journal of Regional Science, Vol. 40, 2000, p. 323.
23. Holl A. Manufacturing Location and Impacts of Road Transport Infrastructure: Empirical Evidence from Spain. Regional Science and Urban Economics, Vol. 34, 2004, p. 341.
24. Holl A. Transport Infrastructure, Agglomeration Economies, and Firm Birth: Empirical Evidence from Portugal. Journal of Regional Science, Vol. 44, No. 4, 2004, p. 693.
25. Holl A. Start-ups and Relocations: Manufacturing Plant Location in Portugal. Papers in Regional Science, Vol. 83, No. 4, 2004. p. 649.
26. Fotopoulos G., and Spence N. Spatial Variations in New Manufacturing Plant Openings: Some Empirical Evidence from Greece. Regional Studies, Vol. 33, No. 3, 1999, pp. 219–229.
27. Portuguese Classification of Economic Activities, Revision 2 (CAE Rev. 2). Instituto Nacional de Estatistica, Lisbon, Portugal, 1994.
28. Code of Administrative Division. Instituto Nacional de Estatistica, Lisbon, Portugal, 1995. http://www.ine.pt/Prodserv/Nomenclaturas/refter/mi/contagens93_e_95.pdf. Accessed May 2, 2006.
29. Isserman A. M. The Location Quotient Approach to Estimating Regional Economic Impacts. Journal of the American Institute of Planners, Vol. 43, No. 1, 1977, pp. 33–41.
30. Cameron A. C., and Trivedi P. K. Econometric Models Based on Count Data: Comparisons and Applications of Some Estimators and Tests. Journal of Applied Econometrics, Vol. 1, 1986, pp. 29–53.
31. Long J. S., and Freese J. Regression Models for Categorical Dependent Variables Using Stata. Stata Corporation, College Station, Tex., 2003.
32. Cameron A. C., and Trivedi P. K. Microeconometrics: Methods and Applications. Cambridge University Press, Cambridge, United Kingdom, 2005.
33. Hardin J. W., and Hilbe J. M. Generalized Linear Models and Extensions, 2nd ed. Stata Press, College Station, Tex., 2007.
34. Cameron A. C., and Trivedi P. K. Regression Analysis of Count Data. Cambridge University Press, Cambridge, United Kingdom, 1998.
35. Cameron A., and Windmeijer P. R-Squared Measures for Count Data Regression with Applications to Health-Care Utilization. Journal of Business and Economic Statistics, Vol. 14, No. 2, 1996, pp. 209–219.
36. Moyes A., and Westhead P. Environments for New Firm Formation in Great Britain. Regional Studies, Vol. 24, No. 2, 1990, pp. 123–136.
Cite article
Cite article
Cite article
OR
Download to reference manager
If you have citation software installed, you can download article citation data to the citation manager of your choice
Information, rights and permissions
Information
Published In
Article first published online: January 1, 2010
Issue published: January 2010
Authors
Metrics and citations
Metrics
Journals metrics
This article was published in Transportation Research Record: Journal of the Transportation Research Board.
VIEW ALL JOURNAL METRICSArticle usage*
Total views and downloads: 79
*Article usage tracking started in December 2016
Altmetric
See the impact this article is making through the number of times it’s been read, and the Altmetric Score.
Learn more about the Altmetric Scores
Articles citing this one
Receive email alerts when this article is cited
Web of Science: 0
Crossref: 20
- Transportation and urban spatial structure: Evidence from Paris
- Highway expansion and impacts on land use changes: An event study appr...
- Transport endowment, knowledge spillovers and firm performance in emer...
- The impact of transport infrastructure on firms’ location decision: A ...
- What drives the allocation of motorways? Evidence from Portugal's fast...
- Analyzing Change in Business Activity before, during, and after Autono...
- Spatial patterns of transport accessibility and traffic load in Czechi...
- Highway Expansion and Impacts on Land Use Changes: An Event Study Appr...
- Assessing the spillover effects of investment in transport infrastruct...
- Location determinants of high-tech firms: an intra-urban approach
- Impact of transport infrastructure on local development in Dalmatia
- Firm Survival as a Function of Individual and Local Uncertainties: An ...
- Spatial changes in distribution of firms and selected industries aroun...
- Workers wanted: Changing employee accessibility with industrial develo...
- New road infrastructure: The effects on firms
- TRAFFIC CONGESTION, POLYCENTRICITY, AND INTRAURBAN FIRM LOCATION CHOIC...
- Firm Births, Access to Transit, and Agglomeration in Portland, Oregon,...
- Distributive effects of new highway infrastructure in the Netherlands:...
- Agglomeration, accessibility and industrial location: Evidence from Sp...
- The Geographical Scope of Industrial Location Determinants: An Alterna...
Figures and tables
Figures & Media
Tables
View Options
Get access
Access options
If you have access to journal content via a personal subscription, university, library, employer or society, select from the options below:
loading institutional access options
Alternatively, view purchase options below:
Purchase 24 hour online access to view and download content.
Access journal content via a DeepDyve subscription or find out more about this option.
