A MICRO-SIMULATION MODEL OF FIRM RELOCATIONS

A modeling framework is developed to analyze decisions regarding relocation pattern for individual firms using discrete choice models. In this framework, three decision points in the relocation process are maintained in the micro-simulation modeling. The first decision, to move or not, is modeled using a binary logit form with outcome of the moving probability. The second decision, choosing the region, is modeled as a multinomial logit model with outcome of the conditional probability of choosing region. The final decision, choosing zone, is estimated under considering the spatial interactions by mixed logit models. In this study, the results indicate that the big firms and old firms have a lower probability of relocating. Next, this study found that region which has a short distance move is more attractive to migrating firms. Finally, the spatial effects and land prices strongly affect the zone choice decision-making process of all firms in the metropolitan area.