Manufacturers' Location Decisions: Do Surveys Provide Helpful Insights?

Abstract

Survey responses from 110 branch plant start-ups in South Carolina and Georgia were examined to determine ratings and characteristics of counties selected for the plant location. Findings indicate that survey responses and community characteristics were correlated only for easily observed criteria (e.g., distance to airport or interstate highway) and location factors of critical importance to the firm (e.g., availability of skilled labor for high-tech firms). Also, the correlation between factor ratings and county-level proxy measures was stronger for larger establishments than for smaller ones, indicating a more limited search process by smaller manufacturers. Research findings suggest that locational factors should be reported by highly disaggregated categories. A return to a "case studies" approach may be useful to gain insights into location decisions.