Market Potential and the Location of Japanese Investment in the European Union ∗ Keith Head †

  title={Market Potential and the Location of Japanese Investment in the European Union ∗ Keith Head †},
  author={Thierry Mayer},
We investigate the hypothesis that firms prefer to locate “where the markets are.” We use a theoretical model of location choice under imperfect competition to formalize this concept. The model yields a profit function incorporating a term closely connected to the market potential index introduced by Harris in 1954. The location decision is a function of demand in all locations weighted by accessibility to consumers. We also show how the spatial distribution of competitors should be factored… CONTINUE READING
Highly Influential
This paper has highly influenced 25 other papers. REVIEW HIGHLY INFLUENTIAL CITATIONS
Highly Cited
This paper has 152 citations. REVIEW CITATIONS

From This Paper

Figures, tables, and topics from this paper.


Publications citing this paper.

152 Citations

Citations per Year
Semantic Scholar estimates that this publication has 152 citations based on the available data.

See our FAQ for additional information.


Publications referenced by this paper.
Showing 1-10 of 25 references

The Market as a Factor in the Localization of Industry in the United States

  • C. Harris
  • Annals of the Association of American Geographers
  • 1954
Highly Influential
10 Excerpts

What Attracts Foreign Multinational Corporations

  • J. Friedman, D. Gerlowski, J. Silberman
  • Journal of Regional Science
  • 1992
Highly Influential
5 Excerpts

Scale Economies, Product Differentiation, and the Pattern of Trade”, American Economic Review 70:950–959

  • P. Krugman
  • 1980
Highly Influential
4 Excerpts

Taxes and the Location of Production : Evidence from a Panel of US Multinationals

  • M. Devereux, R. Griffith
  • Journal of Public Economics
  • 1998
Highly Influential
3 Excerpts

National Borders Matter: Canada-US Regional Trade Patterns”, American Economic Review 85:615–23

  • J. McCallum
  • 1995
Highly Influential
1 Excerpt

Hierarchical Location Choice and Multinational Firms

  • T Mayer, J-L
  • Mucchielli,
  • 2002

Market Potential and the Location of Japanese Investment in the European Union,

  • K. Head, T. Mayer
  • Centre for Economic Policy Research Discussion
  • 2002

Taxation and foreign direct investment A synthesis of empirical research,

  • Mooij R.A, S. Ederveen
  • CPB Discussion Paper No
  • 2001

Similar Papers

Loading similar papers…