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STATUS: Complete YEAR: 2016 TOPIC AREA: Sustainability, energy, and health CENTER: MetroFreight

Why do warehouses decentralize more in certain metropolitan areas?

Project Summary

Project number: MF-4.1h
Funding source: Volvo Research and Educational Foundations

Performance period: 1/1/2016 to 10/9/2018


Project description

Over the last decade, warehousing and distribution centers have decentralized to the urban peripheries where land is cheaper and readily available. This change in location patterns has been driven by the demand to build more modernized and larger facilities to accommodate an ever-increasing influx of freight. Since efficient freight movement is essential for the smooth functioning of metropolitan areas, decentralization should occur everywhere. However, this is not necessarily true. It is hypothesized that depending on the volume of goods movement and the spatial distribution of land prices, the extent of decentralization varies across metropolitan areas. This hypothesis is tested using 48 US metropolitan areas. Results provide robust evidence that high land prices push large warehouses away from central locations. When freight demand and land prices are not as high, the effect becomes insignificant. Indeed, not only is decentralization linked with large metro areas but also with very large warehouses.


Genevieve Giuliano
Professor; Margaret and John Ferraro Chair in Effective Local Government; Senior Associate Dean for Research and Technology; Director, METRANS , Sol Price School of Public Policy
650 Childs Way
Ralph and Goldy Lewis Hall (RGL) 216Los Angeles, CA 90089-0626
United States
[email protected]

Sanggyun Kang
Postdoctoral Research Associate, College of Architecture, Planning and Public Affairs
601 W. Nedderman Drive
Suite 203Arlington, TX 76019-0108
United States
[email protected]