Location determinants of foreign logistics firms in China: A discrete choice approach

Abstract

This thesis attempts to study the influence of site and firm-specific characteristics on location behavior of foreign logistics firms. Partial equilibrium models were developed to investigate how the profit level of logistics service providers was determined, within a market structure of monopolistic competition. Empirically, discrete choice models based on recent census data were employed in order to investigate location determinants of foreign logistics providers in China.The empirical results indicated that the location of foreign logistics firms across cities was influenced by market size, transport infrastructure, labor and communication cost, economic privatization degree, government policies and agglomeration economies. The importance of the above factors was found to vary with some firm-specific characteristics, such as firm age, organization structure and source of region.The intra-metropolitan location determinants included the distance to central business district, proximity to transport infrastructure and supporting services, market and labor considerations, urbanization economies and government policies. The importance of the above factors varied somewhat with firms-specific characteristics as well.