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On the regionalization of input–output tables with an industry-specific location quotient

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  • Xiaoyun Zhao
  • Sung-Goan Choi

Abstract

The purpose of this study is to contribute to the ongoing debate about the performance of several location quotients (LQs), including Flegg’s location quotient (FLQ) and the industry-specific FLQ (SFLQ), which was newly developed by Kowalewski (Reg Stud, 240–250, 2015 ). Unlike FLQ, which has one unique $$\delta $$ δ -value for all industries in a region, SFLQ allows for a variation in the exponential parameter value of $$\delta $$ δ for each industrial sector in order to capture specialization and to reduce the tendency for overestimation or underestimation of each of the industries in a given region. Since the national and regional survey data are available for South Korea, this study evaluates and compares the results for SFLQ against those of other non-survey techniques. The findings prove that SFLQ is superior to other LQs, including FLQ and augmented FLQ. In addition, empirical evidence shows that the optimal values for the exponential parameters vary drastically among industries. SFLQ provides more detailed information on regional industries with individual $$\delta $$ δ values, which is definitely helpful when analyzing regional specialization and shifts in industrial structure. Furthermore, to determine the optimal exponential $$\delta ({\delta _j })$$ δ ( δ j ) value in FLQ and SFLQ in advance, Flegg’s and Kowalewski’s regression models are tested with the use of Korean data. The statistics indicate that the regression equations are debatable and still need major improvement. Copyright Springer-Verlag Berlin Heidelberg 2015

Suggested Citation

  • Xiaoyun Zhao & Sung-Goan Choi, 2015. "On the regionalization of input–output tables with an industry-specific location quotient," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 54(3), pages 901-926, May.
    • Handle: RePEc:spr:anresc:v:54:y:2015:i:3:p:901-926
    DOI: 10.1007/s00168-015-0693-x
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    Cited by:

    1. Anthony T. Flegg & Guiseppe R. Lamonica & Francesco M. Chelli & Maria C. Recchioni & Timo Tohmo, 2021. "A new approach to modelling the input–output structure of regional economies using non-survey methods," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 10(1), pages 1-31, December.
    2. Georgios Lampiris & Christos Karelakis & Efstratios Loizou, 2020. "Comparison of non-survey techniques for constructing regional input–output tables," Annals of Operations Research, Springer, vol. 294(1), pages 225-266, November.
    3. Xesús Pereira-López & Napoleón Guillermo Sánchez-Chóez & Melchor Fernández-Fernández, 2021. "Performance of bidimensional location quotients for constructing input–output tables," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 10(1), pages 1-16, December.
    4. Jim McFarlane & Bligh Grant & Boyd Blackwell & Stuart Mounter, 2017. "Combining amenity with experience," Tourism Economics, , vol. 23(5), pages 1076-1095, August.

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    More about this item

    Keywords

    R15; C67;

    JEL classification:

    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods
    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models

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