Optimal Locational Choice for Agribusinesses in Madagascar : An Application of Spatial Autoregressive Tobit Regression

The traditional location theory predicts that firms' locational choice is independent of the output demand. However, firms are often concentrated in large markets. In Africa, agrobusinesses are expected to play an important role to facilitate...

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Main Author:	Iimi, Atsushi
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2018
Subjects:	LOCATION THEORY GEOSPATIAL ECONOMICS AGGLOMERATION ECONOMIES SPATIAL AUTOCORRELATION CENSORED REGRESSION AGRIBUSINESS LABOR MARKET
Online Access:	http://documents.worldbank.org/curated/en/378801529588239387/Optimal-locational-choice-for-agrobusinesses-in-Madagascar-an-application-of-spatial-autoregressive-Tobit-regression http://hdl.handle.net/10986/29941

id	okr-10986-29941
recordtype	oai_dc
spelling	okr-10986-299412021-06-12T09:01:50Z Optimal Locational Choice for Agribusinesses in Madagascar : An Application of Spatial Autoregressive Tobit Regression Iimi, Atsushi LOCATION THEORY GEOSPATIAL ECONOMICS AGGLOMERATION ECONOMIES SPATIAL AUTOCORRELATION CENSORED REGRESSION AGRIBUSINESS LABOR MARKET The traditional location theory predicts that firms' locational choice is independent of the output demand. However, firms are often concentrated in large markets. In Africa, agrobusinesses are expected to play an important role to facilitate agricultural growth but are hardly available in rural areas. This paper examines the question of why agribusinesses are not located in local production areas despite the clear benefits expected from close proximity to their inputs. By applying the spatial autocorrelation Tobit model, the paper estimates the impacts of market and farm accessibility on agglomeration of new agrobusinesses in Madagascar. The findings show that market accessibility and agglomeration economies are important for attracting more agrobusinesses. The quality of labor is also an important determinant for their locational choice. The findings are consistent with some models of location theory: firms move away from rural areas where they may still have monopsony power, toward urban areas where productivity is higher. 2018-06-28T14:50:07Z 2018-06-28T14:50:07Z 2018-06 Working Paper http://documents.worldbank.org/curated/en/378801529588239387/Optimal-locational-choice-for-agrobusinesses-in-Madagascar-an-application-of-spatial-autoregressive-Tobit-regression http://hdl.handle.net/10986/29941 English Policy Research Working Paper;No. 8488 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 Madagascar
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	LOCATION THEORY GEOSPATIAL ECONOMICS AGGLOMERATION ECONOMIES SPATIAL AUTOCORRELATION CENSORED REGRESSION AGRIBUSINESS LABOR MARKET
spellingShingle	LOCATION THEORY GEOSPATIAL ECONOMICS AGGLOMERATION ECONOMIES SPATIAL AUTOCORRELATION CENSORED REGRESSION AGRIBUSINESS LABOR MARKET Iimi, Atsushi Optimal Locational Choice for Agribusinesses in Madagascar : An Application of Spatial Autoregressive Tobit Regression
geographic_facet	Africa Madagascar
relation	Policy Research Working Paper;No. 8488
description	The traditional location theory predicts that firms' locational choice is independent of the output demand. However, firms are often concentrated in large markets. In Africa, agrobusinesses are expected to play an important role to facilitate agricultural growth but are hardly available in rural areas. This paper examines the question of why agribusinesses are not located in local production areas despite the clear benefits expected from close proximity to their inputs. By applying the spatial autocorrelation Tobit model, the paper estimates the impacts of market and farm accessibility on agglomeration of new agrobusinesses in Madagascar. The findings show that market accessibility and agglomeration economies are important for attracting more agrobusinesses. The quality of labor is also an important determinant for their locational choice. The findings are consistent with some models of location theory: firms move away from rural areas where they may still have monopsony power, toward urban areas where productivity is higher.
format	Working Paper
author	Iimi, Atsushi
author_facet	Iimi, Atsushi
author_sort	Iimi, Atsushi
title	Optimal Locational Choice for Agribusinesses in Madagascar : An Application of Spatial Autoregressive Tobit Regression
title_short	Optimal Locational Choice for Agribusinesses in Madagascar : An Application of Spatial Autoregressive Tobit Regression
title_full	Optimal Locational Choice for Agribusinesses in Madagascar : An Application of Spatial Autoregressive Tobit Regression
title_fullStr	Optimal Locational Choice for Agribusinesses in Madagascar : An Application of Spatial Autoregressive Tobit Regression
title_full_unstemmed	Optimal Locational Choice for Agribusinesses in Madagascar : An Application of Spatial Autoregressive Tobit Regression
title_sort	optimal locational choice for agribusinesses in madagascar : an application of spatial autoregressive tobit regression
publisher	World Bank, Washington, DC
publishDate	2018
url	http://documents.worldbank.org/curated/en/378801529588239387/Optimal-locational-choice-for-agrobusinesses-in-Madagascar-an-application-of-spatial-autoregressive-Tobit-regression http://hdl.handle.net/10986/29941
_version_	1764470861399588864

Optimal Locational Choice for Agribusinesses in Madagascar : An Application of Spatial Autoregressive Tobit Regression

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