RT Journal Article
SR Electronic
T1 Local Economic Instability and Business Location: The Case of Maine
JF Land Economics
JO Land Econ
FD University of Wisconsin Press
SP 398
OP 411
DO 10.3368/le.83.3.398
VO 83
IS 3
A1 Gabe, Todd M.
YR 2007
UL http://le.uwpress.org/content/83/3/398.abstract
AB This paper investigates the effects of local economic instability on business location in Maine. Instability is represented by the quarterly, six-month, and annual persistence of employment in Maine municipalities, and seasonal spikes in local employment. Regression results suggest that businesses are attracted to areas with high short-term and seasonal stability, but that annual fluctuations in local employment are not a significant deterrent to new business activity. Services businesses are particularly sensitive to local employment fluctuations, presumably because they are often highly integrated into the economy. Findings suggest that policymakers can jointly pursue the objectives of local economic growth and stability. (JEL R11)