The study looked at how nearby areas influence where new factories are built in Spain. They found that the decisions of neighboring municipalities and their characteristics play a role in where new manufacturing businesses choose to set up shop. By analyzing data from 1991 to 1995, the researchers discovered that factors like agglomeration economies in nearby areas can impact industrial location choices. This suggests that entrepreneurs not only consider the benefits of a specific municipality but also take into account what's happening in neighboring areas when deciding where to establish their businesses.