Popular literature and sentiment indicates that information technology is changing how certain types of firms make location decisions. The disciplines of urban and regional economics explain the location of firms with location theory and business location determinants. Speculation that information technology enables footloose location decisions suggests that business location determinants have a greater effect on the location decision of a firm that relies on information technology in production than a firm that uses little or no information technology in production. The research examines two fundamental questions regarding information technology's influence on industrial location. First, is information technology allowing high-technology industry to be footloose, or disperse more than low-technology industry? Second, does high-technology industry react statistically different from low-technology industry to location determinants such that high-technology industry's response to location determinants is greater? Using a detailed data set of location determinants for high- and low-technology manufacturing establishments, the research models high- and low-technology manufacturing location at the city level to analyze these questions. Results from the econometric analysis indicate that information technology's influence on high-technology location decisions does not contribute to footlooseness. In addition, changes in business location determinants do not stimulate much high-technology growth nor are significant determinants necessarily maneuverable by policy. Thus, policy has little effect on high-technology growth, especially at the local level. Policymakers who understand the nuances will not only appreciate what few determinants can be manipulated but also where not to allocate resources.
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