Infrastructure and Firm Dynamics

208 Pages·2007·3.49 MB·English

Infrastructure and Firm Dynamics
A micro-simulation approach

Michiel de Bok

Infrastructure and Firm Dynamics
A micro-simulation approach

Proefschrift

ter verkrijging van de graad van doctor
aan de Technische Universiteit Delft
op gezag van de Rector Magnificus prof.dr.ir. J.T. Fokkema
voorzitter van het College voor Promoties,
in het openbaar te verdedigen op donderdag 3 mei 2007 om 15.00 uur

door Michiel Adriaan DE BOK
civiel ingenieur
geboren te Leerdam
Dit proefschrift is goedgekeurd door de promotoren:
Prof. ir. F.M. Sanders
Prof. dr. ir. P.H.L. Bovy

Toegevoegd promotor: Dr. M.C.J. Bliemer

Samenstelling Promotiecommissie:
Rector Magnificus, voorzitter
Prof. ir. F.M. Sanders, Technische Universiteit Delft, promotor
Prof. dr. ir. P.H.L. Bovy, Technische Universiteit Delft, promotor
Dr. M.C.J. Bliemer, Technische Universiteit Delft, toegevoegd promotor
Prof. A. Daly, University of Leeds, UK
Prof. dr. H.J.P. Timmermans, Technische Universiteit Eindhoven
Prof. dr. F.G. van Oort, Universiteit Utrecht
Prof. dr. G.P. van Wee, Technische Universiteit Delft

TRAIL Thesis Series nr. T2007/5, The Netherlands TRAIL Research School
TRAIL Research School
P.O. Box 5017
2600 GA Delft
The Netherlands
Telephone : + 31 (0) 15 27 86046
Telefax : + 31 (0) 15 27 84333
E-mail : [email protected]

ISBN 978-90-5584-086-1
Keywords: infrastructure, firm-demography, urban economics, micro-simulation

Copyright © 2007 by Michiel de Bok

All rights reserved. No part of the material protected by this copyright notice may be
reproduced or utilised in any form or by any means, electronic or mechanical, including
photocopying, recording or by any information storage and retrieval system, without
written permission of the author.
Printed in The Netherlands
“When you really want something to happen,
the whole universe conspires so that your wish comes true”.

The alchemist (in the form of Melchizedek) says to Santiago,
in “The Alchemist” by Paulo Coelho

Preface

Now, I guess it is common sense that transport infrastructure and urban plans have a
strong and long lasting impact on the urban environment. The opening of a new
highway, generates new traffic and attracts urban development. But why did I decide to
try to make a simulation model that tries to predict such impacts? Answering this
question only with a juvenile interest in Lego and the SimCity computer game would
not do justice to the deeper motivation. During my education as a Civil engineer I
discovered I was more interested in the “do we need an extra bridge?” question than the
“what would be the dimensions of the pillars of this bridge?” question. Answering the
first strategic question is far from straightforward and requires skills from many
disciplines: transportation, econometrics, regional economics, policy management, and
a healthy dose of common sense. During the past years I was lucky to be given the
opportunity to apply the practical intuition of an engineer to a more strategic problem,
that is spatial planning. I am convinced that the planning practice could benefit
significantly from advanced simulation models to evaluate planning or policy
alternatives.
And before I discuss my ideas on such models, I will express my gratitude to a number
of people that made a valuable contribution to this thesis. First, my promoter Frank
Sanders, who provided me the opportunity to conduct a PhD study, in which I could
develop my research skills. He made an crucial contribution by directing me towards an
approach that has great potential for policy assessments: micro-simulation. Next, I owe
much gratitude to Piet Bovy for reviewing many papers and draft model specifications
in my research. I realize how important this supervision has been in the completion of
this thesis. His ability to identify crucial elements and to suggest solutions show great
experience and knowledge. Finally, I benefited much from the supervision of Michiel
Bliemer who helped in particular on the mathematical formulations in research papers
and my thesis.
Next, the chosen micro-simulation approach would not have been possible without the
co-operation of Frank van Oort from the Spatial Planning Agency. He enabled me to
realize my research approach by providing an enormous amount of firm-data. Our
discussions on spatial or locational externalities and how these should be implemented
in urban simulation models have been very valuable. Also I would like to thank Leo van
Wissen from the NIDI, who helped me with valuable feedback on specific firm-
demographic components in my model.
Apart from my affiliation as a PhD, I benefited a lot from working as an analyst in a
number of research companies. With my colleagues at Significance, and previously
RAND Europe, I am experiencing how rewarding it is to apply state-of-the-art
techniques to actual planning questions. When I started my PhD I still worked as an
analyst with ABF Research in Delft. I thank many of my former colleagues there for
learning me to work with large datasets, to program simulation models and showing me
that this can be fun as well.
At the university I had much fun with a number of colleagues. I realize my list is not
complete but I should at least thank Berry, Barry, Sander, Robert, Geertje and Olivier
for all the coffee breaks and lunches. In particular Berry, thank you for all the additional
cultural trips on international conferences: the Arctic Circle, Roque Noblo and New
VII
VIII Infrastructure and Firm Dynamics

York are by far better experiences than any scientific session in the backroom of an
uninspiring academic building. Ylva, thank you for all the tastefull and joyfull home-
cooked diners you managed for the department from the first moment I joined our
department until my last PhD-year. Unfortunately there is no opportunity to thank you
in person but the warm corner you created at our department was inspiring.
The last words of gratitude go out to my friends and family for being patient with me at
the times that I was unavailable, in particular in mental terms. Your presence during
these years, and the moments I could no other than surrender to happiness, joy and
sometimes sadness, were crucial for keeping me going. And lastly I want to express my
admiration for Leonie, and thank her for pulling me out of the shadow of this thesis
once and a while.

Michiel de Bok
Haarlem, Maart 2007
Table of contents

PREFACE...............................................................................................................................................VII
NOTATION..........................................................................................................................................XIII

1 INTRODUCTION............................................................................................................................1
1.1 CONTEXT AND BACKGROUND.....................................................................................................1
1.2 RESEARCH OBJECTIVES..............................................................................................................3
1.3 CONTRIBUTIONS.........................................................................................................................4
1.4 THESIS OUTLINE........................................................................................................................5

BACKGROUND

2 PROBLEM ANALYSIS...................................................................................................................7
2.1 INTRODUCTION..........................................................................................................................7
2.2 THE DOMAIN OF URBAN PLANNING............................................................................................8
2.3 INTEGRATED LAND USE AND TRANSPORT MODELS...................................................................12
2.4 FIRM LOCATION IN INTEGRATED MODELS.................................................................................16
2.5 CONCLUSIONS FOR RESEARCH..................................................................................................18
3 THEORIES ON FIRM LOCATION AND TRANSPORT.........................................................21
3.1 INTRODUCTION........................................................................................................................21
3.2 CLASSICAL THEORIES OF FIRM LOCATION AND TRANSPORT.....................................................22
3.3 AGGLOMERATION IN URBAN ECONOMICS.................................................................................27
3.4 MEASURES OF ACCESSIBILITY AND AGGLOMERATION..............................................................31
3.5 HYPOTHESES ON FIRM LOCATION, TRANSPORT AND AGGLOMERATION....................................35
3.6 CONCLUSIONS..........................................................................................................................37
4 FIRM-DEMOGRAPHIC MICRO-SIMULATION.....................................................................39
4.1 INTRODUCTION........................................................................................................................39
4.2 FIRM-DEMOGRAPHY.................................................................................................................40
4.3 MICRO-SIMULATION OF THE FIRM POPULATION.......................................................................43
4.4 CONCLUSIONS..........................................................................................................................50

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X Infrastructure and Firm Dynamics

THEORETICAL MODEL

5 DESIGN OF A SPATIAL FIRM-DEMOGRAPHIC MICRO-SIMULATION MODEL........53
5.1 INTRODUCTION........................................................................................................................53
5.2 GEOGRAPHICAL SCALE LEVELS................................................................................................54
5.3 FRAMEWORK OF THE SFM MODEL...........................................................................................55
5.4 FIRM-DEMOGRAPHIC COMPONENTS..........................................................................................57
5.5 SPATIAL ATTRIBUTES...............................................................................................................66
5.6 CONCLUSIONS..........................................................................................................................69
6 DESIGN OF THE LOCATION CHOICE MODEL...................................................................71
6.1 INTRODUCTION........................................................................................................................71
6.2 THE LOCATION DECISION OF FIRMS..........................................................................................72
6.3 DISCRETE CHOICE THEORY.......................................................................................................75
6.4 THE LOCATION CHOICE MODEL FOR FIRMS...............................................................................77
6.5 CONCLUSION............................................................................................................................83

CASE STUDY

7 DESCRIPTION OF THE CASE STUDY SOUTH HOLLAND.................................................85
7.1 INTRODUCTION........................................................................................................................85
7.2 GEOGRAPHY OF THE STUDY AREA............................................................................................86
7.3 DATA.......................................................................................................................................88
7.4 MODEL ARCHITECTURE............................................................................................................91
7.5 ACCESSIBILITY IN THE STUDY AREA.........................................................................................93
7.6 AGGLOMERATION IN THE STUDY AREA....................................................................................96
7.7 CORRELATION BETWEEN ATTRIBUTES....................................................................................100
7.8 CONCLUSIONS........................................................................................................................102
8 ESTIMATION OF THE FIRM-DEMOGRAPHIC MODELS................................................103
8.1 INTRODUCTION......................................................................................................................103
8.2 ESTIMATION RESULTS OF THE RELOCATION PROBABILITY MODEL..........................................104
8.3 ESTIMATION OF THE FIRM LOCATION CHOICE MODEL.............................................................106
8.4 ESTIMATION RESULTS FOR FIRM GROWTH BY INDUSTRY SECTOR...........................................117
8.5 ESTIMATION RESULTS FOR FIRM DISSOLUTION MODEL...........................................................124
8.6 FIRM FORMATION...................................................................................................................125
8.7 CONCLUSIONS........................................................................................................................127
9 VALIDATION OF THE SFM MODEL.....................................................................................131
9.1 INTRODUCTION......................................................................................................................131
9.2 DESCRIPTION OF INPUT DATA AND OBSERVATIONS................................................................132
9.3 VALIDATION OF POPULATION AGGREGATES...........................................................................135
9.4 EXAMPLES OF PREDICTION RESULTS AT MICRO LEVEL...........................................................136
9.5 VALIDATION OF SIMULATED EMPLOYMENT BY ZONE.............................................................138
9.6 CONCLUSIONS........................................................................................................................142