Location Analyses of Foreign Firms in an Emergent Immigration Gateway in the U.S. South

ABSTRACT

Through spatial analyses of a unique foreign firm data set, this study examines the spatial patterns of foreign firms in a globalizing Southern city and the associated factors at the neighborhood level. It finds that locations with high business density, especially a historic base of foreign firms, have an advantage in attracting foreign direct investments. Further, Japanese firms stand out due to a strong relationship between the local concentration of the Japanese population and the distribution of Japanese firms. Results suggest that, in addition to traditional consideration of agglomeration effects that are highly focused on firm-level linkages and knowledge spillover, it is important to include demographic transformation and overlapped space between work and livelihood into the theoretical framework to understand the location decisions of foreign direct investment at the local level. Such a broadened view becomes more urgent with the rise of emerging economies worldwide and continuous influx of immigration to the United States.

KEYWORDS:

• Agglomeration
• ethnicity
• foreign direct investment
• foreign firm
• immigration

Notes

¹ A right to work state implements a “Right to Work” law, which secures the right of employees to decide for themselves whether they want to join or financially support a union.