Firm relocation and firm profits : Evidence from the Swedish wholesale trade sector

This study analyses the effects of firm relocation on firm profits, using longitudinal data on Swedish limtied liability firms and employing a difference-in-differnce propensity score method in the empirical analysis. Using propensity score matching, the pre-relocalization differneces between relocating and non-relocating firms are balanced. In addition to that, a difference-in-difference estimator is employed in order to control for all time-invariant unobserved heterogeneity among firms. For matching, nearest neighbour matching, using the one-, two- and three nearest neighbours is employed. The balanacing results indicate that matching achieves a good balance, and that similar relocating and non-relocating firms are being compared. The estimated average treatment on the treatment effects indicate thats relocations has a significant effect on the profits of the relocating firms. In other words, firms taht relocate increase their profits significantly, in comparison to what the profits would be had the firms not relocated. This effect is estimated to vary between 3 to 11 percentage points, depending on the lenght of the analysed period after relocation. 

Entry, re-location and growth in the Swedish wholesale trade industry

Wholesale trade has an intermediate position between manufacturing and retail in the distributional channel. In modern economies, consumers buy few, if any, products directly from manufacture or producer. Instead, it is a wholesaler, who is in direct contact with producers, buying goods in larger quantities and selling them in smaller quantities to retailers. Traditionally, the main function of a wholesaler has been to push goods along the distributional channel from producer to retailer, or other nonend user. However, the function of wholesalers usually goes beyond the process of the physical distribution of goods. Wholesalers also arrange storage, perform market analyses, promote trade or provide technical support to consumers (Riemers 1998). The existence of wholesalers (and other intermediaries) in the distributional channel is based on the effective and efficient performance of distribution services, that are needed by producers and other members of the supply chain. Producers usually do not enjoy the economies of scale that they have in production, when it comes to providing distributional services (Rosenbloom 2007) and this creates a space for wholesalers or other intermediaries. Even though recent developments in the distributional channel indicate that traditional wholesaling activities now also compete with other supply chain organizations, wholesaling still remains an important activity in many economies (Quinn and Sparks, 2007). In 2010, the Swedish wholesale trade sector consisted of approximately 46.000 firms and generated an annual turnover of 1 300 billion SEK (Företagsstatistiken, Statistics Sweden). In terms of turnover, wholesaling accounts for 20% of the gross domestic product and is thereby the third largest industry. This is behind manufacturing and a composite group of firms in other sectors of the service industry but ahead of retailing. This indicates that the wholesale trade sector is an important part of the Swedish economy. The position of wholesaling is further reinforced when measuring productivity growth. Measured in terms of value added per employee, wholesaling experienced the largest productivity growth of all industries in the Swedish economy during the years 2000 through 2010. The fact that wholesale trade is one of the important parts of a modern economy, and the positive development of the Swedish wholesale trade sector in recent decades, leads to several questions related to industry dynamics. The three topics that will be examined in this thesis are firm entry, firm relocation and firm growth. The main question to be answered by this thesis is what factors influence new firm formation, firm relocation and firm growth in the Swedish wholesale trade sector?

Essays on firm dynamics in the Swedish wholesale trade sector

This thesis consists of a summary and five self-contained papers addressing dynamics of firms in the Swedish wholesale trade sector. Paper [1] focuses upon determinants of new firm formation in the Swedish wholesale trade sector, using two definitions of firms’ relevant markets, markets defined as administrative areas, and markets based on a cost minimizing behavior of retailers. The paper shows that new entering firms tend to avoid regions with already high concentration of other firms in the same branch of wholesaling, while right-of-the-center local government and quality of the infrastructure have positive impacts upon entry of new firms. The signs of the estimated coefficients remain the same regardless which definition of relevant market is used, while the size of the coefficients is generally higher once relevant markets delineated on the cost-minimizing assumption of retailers are used. Paper [2] analyses determinant of firm relocation, distinguishing between the role of the factors in in-migration municipalities and out-migration municipalities. The results of the analysis indicate that firm-specific factors, such as profits, age and size of the firm are negatively related to the firm’s decision to relocate. Furthermore, firms seems to be avoiding municipalities with already high concentration of firms operating in the same industrial branch of wholesaling and also to be more reluctant to leave municipalities governed by right-of-the- center parties. Lastly, firms seem to avoid moving to municipalities characterized with high population density. Paper [3] addresses determinants of firm growth, adopting OLS and a quantile regression technique. The results of this paper indicate that very little of the firm growth can be explained by the firm-, industry- and region-specific factors, controlled for in the estimated models. Instead, the firm growth seems to be driven by internal characteristics of firms, factors difficult to capture in conventional statistics. This result supports Penrose’s (1959) suggestion that internal resources such as firm culture, brand loyalty, entrepreneurial skills, and so on, are important determinants of firm growth rates. Paper [4] formulates a forecasting model for firm entry into local markets and tests this model using data from the Swedish wholesale industry. The empirical analysis is based on directly estimating the profit function of wholesale firms and identification of low- and high-return local markets. The results indicate that 19 of 30 estimated models have more net entry in high-return municipalities, but the estimated parameters is only statistically significant at conventional level in one of our estimated models, and then with unexpected negative sign. Paper [5] studies effects of firm relocation on firm profits of relocating firms, employing a difference-in-difference propensity score matching. Using propensity score matching, the pre-relocalization differences between relocating and non-relocating firms are balanced, while the difference-in-difference estimator controls for all time-invariant unobserved heterogeneity among firms. The results suggest that firms that relocate increase their profits significantly, in comparison to what the profits would be had the firms not relocated. This effect is estimated to vary between 3 to 11 percentage points, depending on the length of the analyzed period. 

Trips and their CO2 emissions induced by a shopping center

Most previous studies have focused on entire trips in a geographic region, while a few of them addressed trips induced by a city landmark. Therefore paper explores trips and their CO2 emissions induced by a shopping center from a time-space perspective and their usage in relocation planning. This is conducted by the means of a case study in the city of Borlänge in mid-Sweden where trips to the city’s largest shopping mall in its center are examined. We use GPS tracking data of car trips that end and start at the shopping center. Thereafter, (1) we analyze the traffic emission patterns from a time-space perspective where temporal patterns reveal an hourly-based traffic emission dynamics and where spatial patterns uncover a heterogeneous distribution of traffic emissions in spatial areas and individual street segments. Further, (2) this study reports that most of the observed trips follow an optimal route in terms of CO2 emissions. In this respect, (3) we evaluate how well placed the current shopping center is through a comparison with two competing locations. We conclude that the two suggested locations, which are close to the current shopping center, do not show a significant improvement in term of CO2 emissions.

I Stormens Öga : En kvalitativ studie inspirerad av grundad teori, om väntade förändringar inom elitidrottsföreningar

Adapt or die. En omvärld i ständig rörelse ställer högre krav än någonsin på organisationer att utveckla sitt förändringsarbete och sättet man ser på förändringar, något som lett till att fenomenet "organisationsförändringar" blivit ett fokusområde för organisationsforskare. Inom denna forskning framhävs inte sällan vikten av att ta ställning till hur anställda tar emot, och påverkas av, detta förändringsarbete. En typ av förändringar som dock förblivit outforskade är väntade förändringar, förändringar där de anställda vet att en förändring kan komma att ske men inte när eller hur den kommer ske. Inom idrotten återfinns en viss typ av organisationer, elitidrottsföreningar, som ställs inför väntade förändringar med jämna mellanrum. Dessa situationer uppkommer när föreningarna omplaceras i det standardiserade seriesystem som återfinns i Sverige och ställs inför kraftigt omväxlande ekonomiska förutsättningar. För att kunna hantera denna osäkerhet förutsätts att organisationen konstant står redo att genomföra omvälvande förändringar, enbart baserat på föreningens sportsliga resultat. Syftet med uppsatsen är att skapa en förståelse för de anställdas reaktioner vid situationer av omplacering och väntad förändring. För att uppnå syftet utgick uppsatsen ifrån bristen på forskning och sökte, med hjälp av metoden Grundad teori, producera en serie väl underbyggda frågeställningar baserade i studiens fynd. Frågeställningarna producerades sedan via fyra semi-strukturerade intervjuer inom två olika elitidrottsföreningar. Resultatet visar på att en utbredd acceptans för väntade förändringar återfinns hos anställda inom elitidrottsföreningar. Uppsatsens fynd grundades i data från respondenterna och sammanställdes via en resultatmodell innehållandes en kärnkategori och fyra underkategorier. Uppsatsen erbjuder således, via metodvalet, en nyproducerad infallsvinkel på en situation som många organisationer inom idrotten – men även utanför – kan komma att ställas inför.

Residential planning, driver mobility and CO2 emission

The literature on residences and citizens’ transports has focused on either reforming traffic managing in response to residential relocation or post-evaluation of urban planning policies or the evolution of the urban spatial form. In a city there are hotspots that attract the citizens and most of the transportation in the city arises as the citizens’ movement between their residence and the hotspots. Little scholarly attention has been devoted to the possibility to minimize citizens’ transportation in the city by the urban planning of residential areas. In this paper we propose a method to evaluate the environmental impact (in terms of CO2-emissions) of urban plans of residential areas. The method is illustrated in a Swedish case of a midsize city which is presently preoccupied with urban planning of new residential areas in response to substantial population growth due to immigration. The residential plans aims to increase the compactness and residential density in the current center and sub centers leads to less CO2 emissions compare to urban expansion to the edge of the city. The plans of concentrated apartment buildings are more effective in meeting residential needs and mitigating CO2 emissions than dispersed single-family houses.