The Location of Sales Offices and the Attraction of Cities

• Published in: The Journal of political economy Vol. 113; no. 3
• Main Author: Holmes, Thomas J
• Format: Journal Article
• Language: English
• Published: University of Chicago Press, Journals Division 01.06.2005
• Subjects: Costs; School Business Relationship

This paper examines how manufacturers locate sales offices across cities. Sales office costs are assumed to have four components: a fixed cost, a frictional cost for out-of-town sales, a cost-reducing knowledge spillover related to city size, and an idiosyncratic match quality for each firm-city pai...