Start Ups and Relocations: Manufacturing Plant Location in Portugal

This article analyses the spatial pattern of plant start-ups and plant relocations in Portugal between 1986 and 1997. The results show that start-ups and relocations are not attracted by the same set of location characteristics. The probability of a plant start-up is more strongly related to increases in local market size and labour force qualification, lower labour costs, and a more diversified economic environment. In contrast, relocations show a greater preference for areas with better national market accessibility, availability of producer services and a larger industrial basis. Relocations are also much more strongly attracted by the provision of inter-regional motorways. The results are consistent with the assertion that firms value location attributes differently over the plant life cycle.