Essays in regional industrial organization

Abstract

This dissertation is a collection of three essays in regional industrial organization. Chapter 2 analyses zone pricing in retail drywall. Retailers post the exact same price in all stores in large regions, even though these price zone encompass markets of different size and competiveness. The chapter estimates what the costs of making finer price zones must be based on forgone profits of greater price discrimination. Chapters 3 and 4 examine how motor vehicle parts suppliers react to changes in assembly plant location. Chapter 3 estimates a model of location choice in which forward-looking parts supplier decide where to enter and when to exit based on their expectations of the evolution of the industry. This model identifies what attracts suppliers and how they will react to changes in the alignment of assembly plants. Chapter 4 uses a natural experiment to find how a new assembly plant opening affects the number of supplier plants and jobs within various distances.