North, South, Town, Country: which is worst?

18th Feb '17 by snickers

2 comments 4194 reads

You have probably wondered about the truth of the claim that Southern entrepreneurs - and the businesses they run - are shifty, unscrupulous and two-faced. We need take nobody's word for it because the data is available. Let's investigate!

I got hold of a list of the postcodes of HQs of all the firms on the market, converted them into Latitude and Longitude, and merged this with Stockopedia's Quality measure. Here's a graph - you can make out a ghostly British Isles..

Nothing seems to be going on as regards how good quality firms are distributed: so let's take one dimension at a time: here's Quality plotted against Latitude: going from bottom to top are firms based in the Channel Islands, the Channel itself, then a dense band for London, and so on with a few firms probably from Aberdeen at the very top.

There's a negligibly small positive corrolation: the mean Latitude of firms with higher Quality is a tiny bit further North than lower Quality: at a rate of about a mile per Quality Rank point.

Are things more interesting if we travel West???

Neither mickling nor muckling..

Perhaps we're asking the wrong question: should we be considering the remoteness of the firm from cynical and debauched cities? The following plot assigns firms a score based on how near they are to other HQs. You can see that, for instance, that firms in the Channel Islands or even Aberdeen are not classed as isolated, but east Kent is isolated.

Now we can group firms by this measure and find the average quality for each group...

Now we get a suggestion that it's an urban HQ that should be pecking the investor's head. And we can see that our prejudices against offshore domeciles do look valid.. Here's the data on a more conventional graph..

There is a positive corrolation, but the scatter of points is very big. I don't think a statistician would put a lot of predictive power on this relationship, at least at the urban end: but it does look like remote firms are a little bit safer.