Production location choice and risk aversion

This paper attempts to provide a general comparative static analysis on a f irm's choice of production location with respect to variations in the degre e of risk aversion under demand price, input price, and technology uncertai nties. Our analysis shows that whether and how the plant location varies wi th a change in the firm's degree of risk aversion depend upon the nature of the production technology and how the input and location choice affect ris k. It also demonstrates that some of our results are new, while some are ge neralizations of those obtained by Martinich and Hurter (1982).