Research Summary
Research Summary
Resource Relatedness and the Location Strategy of the Multi-Business Firm
Description
We provide new insights into firm location decisions by disentangling and comparing location strategies of multibusiness firms and standalone firms in the same industries. We find that units of multibusiness firms exhibit internal agglomeration, which is stronger than the agglomeration of unrelated firms and the difference is primarily related to the potential for sharing of labor resources. Our results suggest that strategic decisions about the geographic and product boundaries of the firm are intimately related, and that resource sharing is implicated in both.