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  • Urban Vibrancy and Corporat...
    DOUGAL, CASEY; PARSONS, CHRISTOPHER A.; TITMAN, SHERIDAN

    The Journal of finance (New York), February 2015, Volume: 70, Issue: 1
    Journal Article

    We find that a firm's investment is highly sensitive to the investments of other firms headquartered nearby, even those in very different industries. A firm's investment also responds to fluctuations in the cash flows and stock prices (q) of local firms outside its sector. These patterns do not appear to reflect exogenous area shocks such as local shocks to labor or real estate values, but rather suggest that local agglomeration economies are important determinants of firm investment and growth.