Regional Input-Output Analysis

Regional economies, like their national counterparts, are continuously subjected to changes in their growth and development patterns. The changes may result from actions within the region, or the action may occur at the national level. Most changes involve both initial or direct impacts and secondary or indirect impacts. Regional analysts in federal, state, and local government and in the private sector are often called upon to develop models to estimate these impacts. A class of models which has played an important role in the provision of such information is the regional input-output model. This monograph provides an introduction to the use of this model; it traces its early development from two sources: simple aggregate models of the national economy and economic base models. The basic accounting framework is presented, focusing on the structural interrelations which exist between industries. Thus, one is able to appreciate why changes in one sector of the economy often have important repercussions in other parts of the economy. The model provides various types of multipliers which can be used to calculate the effects of new firms on the local economy or just how many jobs might be lost or gained within the region if the federal government moved from social to defense spending programs. The construction and use of the models are detailed and some important new developments are summarized. In particular, attention is focused on the way the input-output model can be extended or linked with other models. Extensions with linear programming, econometric models, and labor force models provide the analyst with the ability to handle such problems as energy supply and demand, the labor force impacts of structural change, the benefits and costs of projects on the regional economy, and the effects of projects on income distribution. The input-output model is thus seen as a flexible tool for regional analysis, one which is used in countries no matter what their political philosophy. "Well focused, logically structured and easy to follow. This monograph is quite helpful and should find a ready audience in senior and graduate level seminars. Examples are clearly presented and calculations are easy to follow. The writing throughout is clear and focused. . . . A very helpful book." --Geographical Analysis