The Structural Embeddedness of Business Decisions: The Migration of Manufacturing Plants in New York State, 1960 to 1985

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Abstract
We present a sociological analysis of regional political economies specifically examining industrial migration in New York Stare. Migration of manufacturing establishments is structurally embedded in regional production cultures that create imperatives to remain in the region, even if the local area has high costs compared to other viable sites. Migration occurs only when the core establishments in a region-the central nodes in the regional exchange network-face outside competition that threatens to permanently undermine their viability. Under such circumstances, only these core establishments can respond to lower costs elsewhere. Peripheral firms are usually too dependent on the material, political, and social resources available in the local production culture to risk departure, even when production costs might be substantially reduced. We test this structural-embeddedness model against the comparative-cost model. The local or distant destinations of New York manufacturing plane that migrated between 1960 and 1985 are examined in a polytomous logistic regression analysis. We find clear support of the structural-embeddedness model. The migration of only a few core establishments-those with the greatest structural autonomy-is consistent with comparative-cost predictions. However peripheral establishments, comprising the overwhelming majority of all plants in the state, are unlikely to leave the region, even when cost differentials are! severe. This finding is consistent with structural-embeddedness predictions.