The influence of transport on industrial location choice: A stated preference experiment

Abstract

Stated preference experiments are introduced and applied to an investigation of the influence of road transport and other factors on industrial location in terms of the ex ante decision making process. The experiments, based upon repeated hypothetical discrete choices between pairs of locations, involved respondents from firms making trade-offs between the various characteristics in a fractional factorial, orthogonal survey design. In each defined case, a clear hierarchy of location factors emerged. These were found to vary according to the origin of the firm - classified as local relocations, foreign inward investors, and branch plants sourced from national bases. The importance of road links to location choice varied considerably between these groups with the latter rating motorway links the highest of any of the groups of firms. In contrast, overseas sourced branch firms found road links largely unimportant, being outweighed primarily by considerations of workforce and premises. Local relocations fell into two distinct groups with respect to the importance attached to road links (between relatively important and non-important), whilst considering the other factors similarly. Good public transport provision emerged as a statistically significant factor only in certain scenarios. Finally, the paper discusses implications for location choice models in transport and further research.