Seminar – Industry Networks and the Geography of Firm Behaviour

William Grieser, Assistant Professor of Finance, Neeley School of Business, Texas Christian University

We consider the role of regional peers in the determination of firm behaviour. We exploit intransitivity in regional peer firm networks and spatial econometric techniques to circumvent well known challenges in estimating and interpreting empirical models of peer effects. We find that regional network effects play a highly significant causal role in explaining corporate investment decisions, and a much more moderate role in explaining financial policy and firm performance. We then implement a novel structured network regression to separately identify regional, product market and supply chain network effects. We find that regional externalities influencing firm behaviour operate almost exclusively within industry boundaries, and that regional effects outside of industry are only present (yet moderately so) for corporate investment decisions.

Speaker bio

William Grieser is an Assistant Professor of Finance at the Neeley School of Business, Texas Christian University. He holds a PhD in finance from Michigan State University and bachelors degrees in applied mathematics (BS) and finance (BBA) from Texas State University. William’s areas of expertise and research are coporate finance, panel data econometrics, intangible investments and financial constraints.