Essays on the Impact of the Geographic Concentration of Industries on Competition and Knowledge Spillovers Público

Abstract

The two essays that constitute this dissertation examine the impact of geographic concentration on organization mortality and relocation. The geographic distribution of an industry determines geographical variation in the performance of organizations within it. In the first essay ("Local Competition, Mortality and Relocation: Geographic Concentration in the US Firearms Industry, 1790-1914"), I argue that a positive relationship between mortality and geographic concentration need not be caused by lower performance in concentrated areas relative to other areas. To test this argument, I use organizational relocation to construct and conduct an 'escape valve' test of local competition in the context of the US firearms industry. The results of the test indicate that organizational relocation and higher mortality rates are not driven by lower performance in dense areas. I put forward an alternative explanation for the results based on the idea that industry exit and and relocation are determined by entrepreneurial and organizational performance thresholds that are affected by geographic variation in opportunity costs. An increasing body of evidence suggests that the costs and benefits of locating in proximity to geographic concentrations of an industry depend on the local industrial organization. In the second essay ("Geographic Concentration and the Local History of Industrial Organization: Postbellum Firearms Firms in the Southern United States"), I argue that they also depend on the previous forms of local industrial organization experienced by organizations proximate to the focal firm. I use the US Civil War as an exogenous institutional shock that briefly changed the industrial organization of the firearms industry in the US South and created two groups of firms in the post-War period--those with experience of the shock and those without. Within this post-War period, I examine differences between the effects of concentrations of Civil War firms and the effects of concentrations of post-Civil War firms on organizational mortality and provide evidence in support of my argument.

Table of Contents

Page

Introduction

1

Essay One
Localized Competition, Mortality, and Relocation: Geographic Concentration in the US Firearms Industry, 1790-1914

1. Introduction

4

2. The Escape Valve Test

5

3. Geographic Concentration and Performance Thresholds

17

4. Conclusion

24

Essay Two
Geographic Concentration and the Local History of Industrial Organization: Postbellum Firms in the Southern United States

1. Introduction

26

2. Geographic Concentration and Local Industrial Organization

27

3. Empirical Strategy

30

4. 'A Dictatorship of Production': The US Civil War and the Southern Firearms Industry

31

5. Data and Analysis

37

6. Results

40

7. A Possible Alternative Explanation

43

8. Conclusion

45

References

48

Figures

58

Tables

64

List of Figures

Page

Figure 1: Organizational density and organizational relocation in the US firearms industry

58

Figure 2: National density of firearms manufacturers and gunsmiths

60

Figure 3: Number of Southern US firearms firms

61

Figure 4: Multiplier of mortality rate, geographic concentration of Civil War firms

62

Figure 5: Multiplier of mortality rate, geographic concentration of post-Civil War firms

63

List of Tables

Page

Table 1: Transition matrix: Relocation across regions of the United States

64

Table 2: Top origin cities

64

Table 3: Top destination cities

65

Table 4: Summary statistics, mortality, and push analyses

65

Table 5: Correlation table, mortality, and push analyses

66

Table 6: Piecewise exponential models of organizational mortality

67

Table 7: Piecewise exponential models of organizational relocation

68

Table 8: Piecewise exponential models of organizational relocation (by distance)

69

Table 9: Summary statistics (conditional logit analysis)

70

Table 10: Correlation table (conditional logit analysis)

70

Table 11: Conditional logit analyses of choice of county destination

71

Table 12: Summary statistics: 1790-1914

72

Table 13: Summary statistics: 1866-1914

73

Table 14: Piecewise constant exponential models of firm mortality: 1790-1914

74

Table 15: Piecewise constant exponential models of firm mortality: 1866-1914

75

Table 16: Technological proficiency: piecewise constant exponential models of firm mortality: 1866-1914

76

About this Dissertation

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School	Laney Graduate School
Department	Business
Degree	PhD
Submission	Dissertation
Language	English
Research Field	Business Administration, Management Sociology, Organizational Economics, Commerce-Business
Palabra Clave	organizational evolution local competition organizational relocation knowledge spillovers inter-organizational relations organizational mortality geographic concentration
Committee Chair / Thesis Advisor	Thompson, Peter, Georgia Institute of Technology Swaminathan, Anand, Emory University
Committee Members	Chellappa, Ramnath, Emory University Negro, Giacomo, Emory University

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