Location decisions in a changing labour market environment

We study the location of various film-related services (such as camera rental, casting agencies or pyrotechnic services), the main determinant of interest being the human capital specificity. We show that firms which supply services with a lower firm specificity locate farther away from one another, and argue that it can be concluded that the "poaching" argument (fear of employees leaving for a competitor in large regional labour markets) has greater practical weight than the Marshallian labour pooling mechanism.