High Tech Firm Performance as a Factor of Agglomeration

Successful firms capitalize on economies of scale & scope, create management structures and invest in research & development

The Silicon Valley area became a major manufacturing power after World War II. The Cold War furthered this development, as industries involved in defense, aerospace, steel, oil, automobiles, and so on prospered (Hossfeld 405-406). The high-technology industry began in the laboratories of corporations such as Bell Laboratories, American Telephone and Telegraph, Fairchild Camera and Instrument, and General Electric during this Cold War era (Bacon, “Organizing”). Employment in California, especially Silicon Valley, grew rapidly between 1950 and 1980 due to technical innovation that characterized the postwar prosperity. Furthermore, federal spending expanded California’s economy, placing it in the

As a supply-side strategy for influencing the location choices of firms, tax policy is used to address what kind of costs? Do taxes influence location decisions?

Additionally, there are many vacant buildings and lots in these towns where production facilities used to sit that could still be used and would not take away necessary farming land. Furthermore, incentives could be offered to the plants if they opened in these rural areas. Local government (not state or national, as that could cause even more issues) could provide small tax cuts to the business for opening in their town, such as a lowered taxes on the land on which they build their facility, or lowered tax rates on the water supply for the building. Because these towns will be receiving more income from sales tax as new people travel to the area, these small cuts will be minuscule in the eyes of the money that will be flowing in from the new jobs being formed. Luckily for these plants, in many rural areas, there are already abandoned buildings that could be bought and used for production. Additionally, these businesses will benefit by opening in small towns by having committed workers who live nearby and will be willing to work their hardest for the company. In recent times, many politicians have promised to bring jobs back to the United States. If these politicians stay true to their word, unemployment single caution light that hangs over the center of my town is a warning to those who are entering the town. It says, “Turn around; there absolutely is nothing here.”

As the nation's economy continues to shift towards being a tech centered entity, several states throughout the country are evolving into tech hubs where tech jobs are growing at record rates. In the past, California and Washington stood as the two most prominent destinations for America's most powerful technology companies. Today, the tide is shifting, and the primary beneficiary looks like it's going to be Texas.

A corporation is independently owned by shareholders; they are larger companies with multiple employees. Some examples of corporations would be; airline companies, soda companies, Google, Hasbro and many more. A conglomerate is a large corporation that has several smaller companies. Business associated with a conglomerate are unrelated and offer different products or services. "John Rockefeller of Standard Oil, Alfred Sloan of General Motors and Gerald Swope of General Electric are some of the business tycoons credited with revolutionizing business practices, which contributed to the organization of today’s conglomerates."(Keefer).

Using the Fourteenth Amendment to protect corporations, by allowing them “corporate personhood”, is wrong; since it ends up granting corporations more rights than citizens. Giant conglomerates benefit from this amendment to earn huge tax breaks, influence political campaigns, and government subsidising. Additionally, as their own legal entities, they can fight wage increases. Not only do companies ship their jobs overseas to take advantage of people in third world countries who will work for practically free, they aim to keep wages at unlivable rates. Recently, Mcdonald's sued the city of Seattle, WA. over the increase of the minimum wage to fifteen dollars per hour. They claimed it would be “bad for business”. These poverty inducing

When General Electric wanted to move their headquarters from Fairfield, Connecticut, where they have been stationed since 1974, they wanted to “be in a vibrant, innovative environment that would be stimulating to workers”(Saunders). They were offered a generous incentive package that was “estimated at $145 million, with $120 million in grants and programs from the state”(Saunders). Government intervention, in this case, helped General Electric move to Boston because they would be able to fully recoup their investment when relocating. Whenever thinking about whether one wants to relocate their business, they need to look at the ethics of it. Is it financially smart to relocate to this area? Well, for General Electric, this was financially smart

However, this does not address the endogeneity between population-employment and transportation location. In other words, new subway stations can also be endogenous to employment and population location. Recent studies have emphasized that transportation network affects growth in population and employment, and locations of population and employment also influence location of transportation system (Baum-Snow, 2007; Duranton and Turner, 2012; and Garcia-Lopez, 2012).

When selecting a corporation the main thing that is considered is the location that has the least expensive access to the needed inputs and outputs. This means that they will need access to any resources, like land, labor, capital, and entrepreneurship, and access to the output markets. Fresno is very capable to accommodate corporations because they do have access to all of these things. Included in this selection there are also many other factors that will go into the final decision of plant location. (See Figure 1). For example, if a city did not have the social

However, if a smaller innovative company enters a city that contains people with lower income, their resources allocated will be directed differently. For instance, their budget might be lower depending on how rapidly consumers are spending; or, certain cities might demand different services. As a result, a negative spillover effect can occur if consumerism changes too rapidly; then, these companies can correct these issues restablishing more realistic goals, reducing the amount of projects to prevent over allocation, and rearranging their budget. All in all, applying these fixtures contributes to dispersing resource allocation in the most economically beneficial

since high-tech firms are more understood and valued in the United States than in other countries,

The article Innovation: Location Matters discusses how the challenges for competiveness in advanced nations and regions has changed. It elaborates on how organizations must create and commercialize a stream of new products and processes that shift the technology frontier. Companies must be able to innovate to sustain competitive advantage by acquiring and deploying the best current technology. Location matters for innovation, and companies must broaden their approaches to the management of innovation accordingly: by developing and commercializing innovation in the most attractive location, taking active steps to access locational strengths, and proactively enhancing the environment for innovation and commercialization in locations where they operate (Porter & Stern, 2001).

With the increasing attraction of MNCs to the size and growth of the Chinese consumer market, some are inclined to overlook the diversity among the indigenous consumers. The popular misconception of China as a huge market with homogeneous consumers often results in difficulties in evaluating demand and formulating effective marketing strategies. In reality, China is a large geographic area consisting of multiple fragmented markets; segmented by regional economic development and local culture. The Chinese also have diverse cultural patterns demonstrated by deviations in dialects, ideals, lifestyles, traditions, and customs. Consequently, these regional disparities affect people's perception of

2). Industrial Location Theory as defined by German economist Alfred Weber is a theory that looks at how businesses will seek to locate to areas where the cost of transportation, labor, and raw materials of the final product are at a minimum and the expected demand for that final product would maximize profit. This means is that industries that produce the same good will tend to clustered in regions that will enable them to reduce their costs of manufacturing (materials, labor, transport, etc.) while simultaneously producing a large market of demand. With this being stated, some Weber’s assumptions of this theory are that 1). the consumer is economically rational, which means that the market economy is based upon the concept that all consumers have total market knowledge (what goods are available and how much they cost to produce). Given such knowledge, each time you consume (demand) a product, you rationally select the good that is