Getting there fast: globalization, intercontinental flights and location of headquarters

This article examines the determinants of the location of large firms headquarters across a rich sample of European urban areas, focusing on the availability of non-stop intercontinental flights. We also account for the influence of other aspects: the proximity to large markets and specialized providers, congestion and tax costs, the availability of skilled labor, and the role of the urban area in the home country. Controlling for these factors, we find that the availability of direct non-stop flights has a large influence on headquarters location. This confirms the importance of transport infrastructures and tacit information exchanges between cities for firm location.