Investigate Spatial-scale Dependency using a Business Location Decision Model
Dube et al. 2016 Location Theories and Business Location Decision: A Micro-Spatial Investigation of a Nonmetropolitan Area in Canada
Region of interest
individual business establishments @ Lower St Lawrence, Canada
Objective
We provide an empirical analysis of the determinants of individual establishments' location decisions in relation to their main economic activity within a random utility model framework.
The objective of this paper:
"First, it sets out to develop a conceptual framework within which to analyze individual location decisions at a micro-geographic scale." "Second, it aims at testing (i) whether the classical factors underlined by location theories, such as agglomeration economies, are statistically related to individual establishments’ location choices, and (ii) whether the conclusions drawn from such analyses are sensitive to the choice of geographical scale used to define local individual spatial indicators."
Methodology
i - establishment s - sector v - main centers
A linear, multinomial regression model under the random utility maximization framework
Short Summary
The main objective of the paper is to test the MAUP hypothesis using a micro-spatial approach. The MAUP states that conclusions about the relationship between local externality and business location can depend on the spatial scale of investigation. In the authors' multinomial regression model, predictors were defined by radius of influence, so that an indicator exists at every spatial location about whether this predictor was at work. The MAUP hypothesis was tested by varying the radius of influence. Results shows that MAUP was true, and different sectors do not respond in the same sign to the same predictors.