April 24, 2006
The Fortune 500 by State
Posted by Fred Tung

Thanks to the 'Glom Masters for inviting me to participate.  As a fan and frequent lurker on the 'Glom, it's a nice thrill to peek behind the curtain and play a Wizard.

So the Fortune 500 list came out last week.  Both the website and the hardcopy edition slice and dice the list a number of ways--byTexas_1 headquarters city, by state, by industry, etc.  The print edition heralds the fact that Texas for the first time is home to more Fortune 500 headquarters than any other state.  (Certain Texa-philes (hi, Christine!) might appreciate that little factoid.).  Others at the top of the list are not surprising--New York, California, Illinois, Ohio.

As a recent transplant from California to Georgia, state law has been on my mind.  Turns out it wasn't simply a move from a blue state to a red one, but at least according to my impressionistic assessment, from a fairly blue state to a really red one.  For example, I've come to learn that Georgia debtor-creditor law is among the most pro-creditor in the nation, while I always knew that California's was among the most debtor-friendly.  Attitudes toward immigration are another study in contrasts.  With the news of the recent rallies over immigration policy, if I had heard just a snippet of morning radio coverage over the hum of my electric toothbrush in California, it would never have occurred to me to wonder which side the ralliers were on.  In Georgia, by contrast, I have to actually listen to the story to figure out which side is doing which rally.

But back to the Fortune 500.  As a sometime-participant in the charter competition wars, one thing that strikes me about the Fortune 500 list is the relative paucity of company headquarters in states with what I thought to be strong industrial traditions.   Massachusetts, for example, has only 9 companies, far fewer than North Carolina with 14.  Maryland has a mere 5 compared with Virginia's 18 companies.  What drives these differences?  Natural factor endowments must matter, although as a company gets bigger its dependence on local endowments must matter less and less.  Corporate law might matter some, if small companies stay at home even after they become big companies.  And they can always reincorporate without moving.  Population may matter, again on the theory that more small companies may start in large markets and then stay there after they've grown up--although Minnesota ranks #9 on the list (19 headquarters) but 21st in population, and Florida ranks 4th in population but #12 on the Fortune 500 list with 14 company headquarters.  While it's not unheard of for big companies to move their headquarters, I don't think it's very common.

Besides state-by-state comparisons, you can find lists of the biggest winners and losers, women CEOS, newcomers to the list, and more here.

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"The 2006 Fortune 500 was released a couple of weeks ago, and Fred Tung at Conglomerate has some inte ..." [more] (Tracked on April 26, 2006 @ 7:56)
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