Firms’ Locational Choice and Infrastructure Development in Rwanda

Agglomeration economies are among the most important factors to increase firm productivity. However, there is little evidence supportive of this in Africa. By applying the conditional and nested logit models, this paper examines the relationship be...

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Main Authors:	Iimi, Atsushi, Humphrey, Richard Martin, Melibaeva, Sevara
Format:	Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2015
Subjects:	SANITATION BUSINESS ACTIVITIES PRODUCTION FOSSIL FUELS LAGS GLOBAL MARKETS GLOBAL COMPETITIVENESS TRANSPORT INFRASTRUCTURE CONSUMER GOODS INFORMATION EXPORTS ELASTICITY INFRASTRUCTURE DEVELOPMENT POLITICAL ECONOMY MANUFACTURERS AGGLOMERATION BENEFITS COMPANIES INDUSTRIAL DEVELOPMENT PUBLIC INFRASTRUCTURE VARIABLES FIRM SIZE TAX INDUSTRIAL DEVELOPMENTS OPEN ACCESS ECONOMIC ACTIVITY DEVELOPMENT COMMUNICATIONS CHOICE DATA INTERNATIONAL COMPETITIVENESS INFRASTRUCTURE ACCESS ROAD SOCIAL SERVICE COSTS ROAD NETWORK TRANSPORT GROWTH PATH ECONOMETRICS PRODUCTIVITY EXTERNALITIES INDUSTRIALIZATION INCREASING RETURNS CRITERIA MARKETS FIRM PRIVATE INVESTMENT CONNECTIVITY WEB SERVICE PROVISION ENTERPRISES RAIL STATIONS SOCIAL DEVELOPMENT PHYSICAL DISTANCE FUELS INFRASTRUCTURE MANUFACTURING PHONE TRANSACTION INVESTORS RELIABILITY FIRMS WAGES POLICIES ECONOMETRIC ANALYSIS RESULTS NESTED LOGIT MODEL VALUE MOBILE PHONE ROAD USE COMMUNICATIONS TECHNOLOGIES COMPETITIVENESS FOREIGN DIRECT INVESTMENT ELECTRICITY ELASTICITIES ACCESSIBILITY AGRICULTURE INFRASTRUCTURE DEVELOPMENTS MARKET GOOD TRANSPORT DIVERSIFICATION ROADS PORT FACILITIES RESULT ECONOMIC DEVELOPMENT TRADE ICT GOODS INTERNATIONAL MARKET BUSINESSES BUSINESS INVESTMENT NETWORK AGGLOMERATION ECONOMIES POSITIVE EXTERNALITIES BUSINESS ENVIRONMENT RAIL MARKET DEMAND POLICY SUPPORT PRIVATE INVESTORS ECONOMIC ACTIVITIES FOREIGN COMPANIES INVESTMENTS PORT ACCESS CUSTOMERS ECONOMIC GEOGRAPHY TRANSPORT COSTS TECHNOLOGIES SEE COMMODITY INTERNATIONAL MARKETS LARGE ENTERPRISES SIZE OF FIRM PRICES USES DEVELOPMENT POLICY
Online Access:	http://documents.worldbank.org/curated/en/2015/06/24570548/firms’-locational-choice-infrastructure-development-rwanda http://hdl.handle.net/10986/22153

id	okr-10986-22153
recordtype	oai_dc
spelling	okr-10986-221532021-04-23T14:04:07Z Firms’ Locational Choice and Infrastructure Development in Rwanda Iimi, Atsushi Humphrey, Richard Martin Melibaeva, Sevara SANITATION BUSINESS ACTIVITIES PRODUCTION FOSSIL FUELS LAGS GLOBAL MARKETS GLOBAL COMPETITIVENESS TRANSPORT INFRASTRUCTURE CONSUMER GOODS INFORMATION EXPORTS ELASTICITY INFRASTRUCTURE DEVELOPMENT POLITICAL ECONOMY MANUFACTURERS AGGLOMERATION BENEFITS COMPANIES INDUSTRIAL DEVELOPMENT PUBLIC INFRASTRUCTURE VARIABLES FIRM SIZE TAX INDUSTRIAL DEVELOPMENTS OPEN ACCESS ECONOMIC ACTIVITY DEVELOPMENT COMMUNICATIONS CHOICE DATA INTERNATIONAL COMPETITIVENESS INFRASTRUCTURE ACCESS ROAD SOCIAL SERVICE COSTS ROAD NETWORK TRANSPORT GROWTH PATH ECONOMETRICS PRODUCTIVITY EXTERNALITIES INDUSTRIALIZATION INCREASING RETURNS CRITERIA MARKETS FIRM PRIVATE INVESTMENT CONNECTIVITY WEB SERVICE PROVISION ENTERPRISES RAIL STATIONS SOCIAL DEVELOPMENT PHYSICAL DISTANCE FUELS INFRASTRUCTURE MANUFACTURING PHONE TRANSACTION INVESTORS RELIABILITY FIRMS WAGES POLICIES ECONOMETRIC ANALYSIS RESULTS NESTED LOGIT MODEL VALUE MOBILE PHONE ROAD USE COMMUNICATIONS TECHNOLOGIES COMPETITIVENESS FOREIGN DIRECT INVESTMENT ELECTRICITY ELASTICITIES ACCESSIBILITY AGRICULTURE INFRASTRUCTURE DEVELOPMENTS MARKET GOOD TRANSPORT DIVERSIFICATION ROADS PORT FACILITIES RESULT ECONOMIC DEVELOPMENT TRADE ICT GOODS INTERNATIONAL MARKET BUSINESSES BUSINESS INVESTMENT NETWORK AGGLOMERATION ECONOMIES POSITIVE EXTERNALITIES BUSINESS ENVIRONMENT RAIL MARKET DEMAND POLICY SUPPORT PRIVATE INVESTORS ECONOMIC ACTIVITIES FOREIGN COMPANIES INVESTMENTS PORT ACCESS CUSTOMERS ECONOMIC GEOGRAPHY TRANSPORT COSTS TECHNOLOGIES SEE COMMODITY INTERNATIONAL MARKETS LARGE ENTERPRISES SIZE OF FIRM PRICES USES DEVELOPMENT POLICY Agglomeration economies are among the most important factors to increase firm productivity. However, there is little evidence supportive of this in Africa. By applying the conditional and nested logit models, this paper examines the relationship between firm locations and infrastructure accessibility in Rwanda. It is found that agglomeration economies matter to even one of the smallest countries in Africa. It is also found that infrastructure availability has an important role in affecting the firm location decision. Electricity access and transport connectivity to the domestic and international markets are found to be important to attract new investment. In addition, the quality of local labor supplied, measured by educational attainment, is found as an important determinant of firm location, while the effect of labor costs remains inconclusive. 2015-07-14T21:01:33Z 2015-07-14T21:01:33Z 2015-06 Working Paper http://documents.worldbank.org/curated/en/2015/06/24570548/firms’-locational-choice-infrastructure-development-rwanda http://hdl.handle.net/10986/22153 English en_US Policy Research Working Paper;No. 7279 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Africa Rwanda
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	SANITATION BUSINESS ACTIVITIES PRODUCTION FOSSIL FUELS LAGS GLOBAL MARKETS GLOBAL COMPETITIVENESS TRANSPORT INFRASTRUCTURE CONSUMER GOODS INFORMATION EXPORTS ELASTICITY INFRASTRUCTURE DEVELOPMENT POLITICAL ECONOMY MANUFACTURERS AGGLOMERATION BENEFITS COMPANIES INDUSTRIAL DEVELOPMENT PUBLIC INFRASTRUCTURE VARIABLES FIRM SIZE TAX INDUSTRIAL DEVELOPMENTS OPEN ACCESS ECONOMIC ACTIVITY DEVELOPMENT COMMUNICATIONS CHOICE DATA INTERNATIONAL COMPETITIVENESS INFRASTRUCTURE ACCESS ROAD SOCIAL SERVICE COSTS ROAD NETWORK TRANSPORT GROWTH PATH ECONOMETRICS PRODUCTIVITY EXTERNALITIES INDUSTRIALIZATION INCREASING RETURNS CRITERIA MARKETS FIRM PRIVATE INVESTMENT CONNECTIVITY WEB SERVICE PROVISION ENTERPRISES RAIL STATIONS SOCIAL DEVELOPMENT PHYSICAL DISTANCE FUELS INFRASTRUCTURE MANUFACTURING PHONE TRANSACTION INVESTORS RELIABILITY FIRMS WAGES POLICIES ECONOMETRIC ANALYSIS RESULTS NESTED LOGIT MODEL VALUE MOBILE PHONE ROAD USE COMMUNICATIONS TECHNOLOGIES COMPETITIVENESS FOREIGN DIRECT INVESTMENT ELECTRICITY ELASTICITIES ACCESSIBILITY AGRICULTURE INFRASTRUCTURE DEVELOPMENTS MARKET GOOD TRANSPORT DIVERSIFICATION ROADS PORT FACILITIES RESULT ECONOMIC DEVELOPMENT TRADE ICT GOODS INTERNATIONAL MARKET BUSINESSES BUSINESS INVESTMENT NETWORK AGGLOMERATION ECONOMIES POSITIVE EXTERNALITIES BUSINESS ENVIRONMENT RAIL MARKET DEMAND POLICY SUPPORT PRIVATE INVESTORS ECONOMIC ACTIVITIES FOREIGN COMPANIES INVESTMENTS PORT ACCESS CUSTOMERS ECONOMIC GEOGRAPHY TRANSPORT COSTS TECHNOLOGIES SEE COMMODITY INTERNATIONAL MARKETS LARGE ENTERPRISES SIZE OF FIRM PRICES USES DEVELOPMENT POLICY
spellingShingle	SANITATION BUSINESS ACTIVITIES PRODUCTION FOSSIL FUELS LAGS GLOBAL MARKETS GLOBAL COMPETITIVENESS TRANSPORT INFRASTRUCTURE CONSUMER GOODS INFORMATION EXPORTS ELASTICITY INFRASTRUCTURE DEVELOPMENT POLITICAL ECONOMY MANUFACTURERS AGGLOMERATION BENEFITS COMPANIES INDUSTRIAL DEVELOPMENT PUBLIC INFRASTRUCTURE VARIABLES FIRM SIZE TAX INDUSTRIAL DEVELOPMENTS OPEN ACCESS ECONOMIC ACTIVITY DEVELOPMENT COMMUNICATIONS CHOICE DATA INTERNATIONAL COMPETITIVENESS INFRASTRUCTURE ACCESS ROAD SOCIAL SERVICE COSTS ROAD NETWORK TRANSPORT GROWTH PATH ECONOMETRICS PRODUCTIVITY EXTERNALITIES INDUSTRIALIZATION INCREASING RETURNS CRITERIA MARKETS FIRM PRIVATE INVESTMENT CONNECTIVITY WEB SERVICE PROVISION ENTERPRISES RAIL STATIONS SOCIAL DEVELOPMENT PHYSICAL DISTANCE FUELS INFRASTRUCTURE MANUFACTURING PHONE TRANSACTION INVESTORS RELIABILITY FIRMS WAGES POLICIES ECONOMETRIC ANALYSIS RESULTS NESTED LOGIT MODEL VALUE MOBILE PHONE ROAD USE COMMUNICATIONS TECHNOLOGIES COMPETITIVENESS FOREIGN DIRECT INVESTMENT ELECTRICITY ELASTICITIES ACCESSIBILITY AGRICULTURE INFRASTRUCTURE DEVELOPMENTS MARKET GOOD TRANSPORT DIVERSIFICATION ROADS PORT FACILITIES RESULT ECONOMIC DEVELOPMENT TRADE ICT GOODS INTERNATIONAL MARKET BUSINESSES BUSINESS INVESTMENT NETWORK AGGLOMERATION ECONOMIES POSITIVE EXTERNALITIES BUSINESS ENVIRONMENT RAIL MARKET DEMAND POLICY SUPPORT PRIVATE INVESTORS ECONOMIC ACTIVITIES FOREIGN COMPANIES INVESTMENTS PORT ACCESS CUSTOMERS ECONOMIC GEOGRAPHY TRANSPORT COSTS TECHNOLOGIES SEE COMMODITY INTERNATIONAL MARKETS LARGE ENTERPRISES SIZE OF FIRM PRICES USES DEVELOPMENT POLICY Iimi, Atsushi Humphrey, Richard Martin Melibaeva, Sevara Firms’ Locational Choice and Infrastructure Development in Rwanda
geographic_facet	Africa Rwanda
relation	Policy Research Working Paper;No. 7279
description	Agglomeration economies are among the most important factors to increase firm productivity. However, there is little evidence supportive of this in Africa. By applying the conditional and nested logit models, this paper examines the relationship between firm locations and infrastructure accessibility in Rwanda. It is found that agglomeration economies matter to even one of the smallest countries in Africa. It is also found that infrastructure availability has an important role in affecting the firm location decision. Electricity access and transport connectivity to the domestic and international markets are found to be important to attract new investment. In addition, the quality of local labor supplied, measured by educational attainment, is found as an important determinant of firm location, while the effect of labor costs remains inconclusive.
format	Working Paper
author	Iimi, Atsushi Humphrey, Richard Martin Melibaeva, Sevara
author_facet	Iimi, Atsushi Humphrey, Richard Martin Melibaeva, Sevara
author_sort	Iimi, Atsushi
title	Firms’ Locational Choice and Infrastructure Development in Rwanda
title_short	Firms’ Locational Choice and Infrastructure Development in Rwanda
title_full	Firms’ Locational Choice and Infrastructure Development in Rwanda
title_fullStr	Firms’ Locational Choice and Infrastructure Development in Rwanda
title_full_unstemmed	Firms’ Locational Choice and Infrastructure Development in Rwanda
title_sort	firms’ locational choice and infrastructure development in rwanda
publisher	World Bank, Washington, DC
publishDate	2015
url	http://documents.worldbank.org/curated/en/2015/06/24570548/firms’-locational-choice-infrastructure-development-rwanda http://hdl.handle.net/10986/22153
_version_	1764450295463542784

Firms’ Locational Choice and Infrastructure Development in Rwanda

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