R | E | A | L

The University of Illinois at Urbana-Champaign

Regional Economics Applications Laboratory


Regional Economic Modeling

Regional economic models can serve as valuable tools for corporate and regional planners by providing information and forecasts of economic conditions at the local level. Since every region is unique in its industrial makeup and general economic environment, specific effort in examining the local economy as an economic engine of its own can prove rewarding. Often, economic conditions and trends seen at the national level are quite different from the experiences of individual regions. Hence, valuable information can be gained by taking a grass roots regional approach to economic analysis.

REAL's primary modeling efforts are focused on the construction and use of Regional Econometric Input/Output Models (REIMs). Each REIM is constructed from the ground up, using information as detailed as plant level purchases and sales. Since completion of REAL's first model, the Chicago Region Econometric Input/Output Model (CREIM), in 1989, REAL has continually updated and refined collection and estimation techniques to maximize the informational content of each model while maintaining a high degree of accessibility.





Uses



The REIMs designed by REAL are structured to serve a wide range of user's specific economic planning and analysis needs. Common uses of these REIMs by our clients include:

Impact analysis: estimating the effects of specific economic events on local industries.

Market analysis: evaluate market structure and dynamics by analyzing the purchases and sales of goods between industries over time.

Efficiency comparisons: compare specific business attributes, such as purchases and labor costs, to industry averages.

Economic analysis: examine general economic trends for the local economy





Regions



REAL's portfolio of economic models covers regions throughout the Midwest, the eastern United States and the world. Currently, there are models completed or under construction for the following regions:
 

US States US Metropolitan Regions International
  • Illinois
  • Indiana
  • Iowa
  • Michigan
  • Ohio
  • Virginia
  • Wisconsin
  • Chicago
  • St. Louis
  • Washington D.C.
  • Northern Virginia
  • Styria, Austria*
  • Ceará, Brazil*
  • Minas Gerais, Brazil
  • Sâo Paulo, Brazil
  • Cartagena, Columbia*
  • Jakarta, Indonesia
  • * Under construction

     If you are interested in renting or purchasing one or more of the models listed above, or wish to inquire about the construction of a model for a region not listed, please contact REAL.






    Software



    Each model is packaged within a custom-designed windows based software. The software itself is specifically designed to allow users easy access to all facets of the REIM. At the click of the mouse, access can be gained to economic analysis information for your region.






    Sectors



    For most US models, each industry within an economy is assigned to one of the 53 core business sectors defined by REAL. Sector definitions are roughly based on the two-digit level of the Standard Industrial Classification (SIC) code system. For each sector, historical and forecasted values are available for output, employment, and income. Additionally, yearly, on a sector by sector basis, volume estimates of purchases and sales between each sector is available for structural and efficiency analysis. Upon request, custom sectoring schemes can be provided. The industries defined within each US REIM are as follows:
     

    No. Industry SIC
    1 Livestock, Livestock Products, and Agricultural Products 01-02
    2 Agriculture, Forestry and Fisheries 07-09
    3 Mining 10, 12-14
    4 Construction 15-17
    5 Food and Kindred Products 20
    6 Tobacco Products 21
    7 Apparel and Textile Products 22-23
    8 Lumber and Wood Products 24
    9 Furniture and Fixtures 25
    10 Paper and Allied Products 26
    11 Printing and Publishing 27
    12 Chemicals and Allied Products 28
    13 Petroleum and Coal Products 29
    14 Rubber and Miscellaneous Plastics Products 30
    15 Leather and Leather Products 31
    16 Stone, Clay, and Glass Products 32
    17 Primary Metals Industries 33
    18 Fabricated Metal Products 34
    19 Industrial Machinery and Equipment 35
    20 Electronic and Other Electric Equipment 36
    21 Transportation Equipment 37
    22 Instruments and Related Products 38
    23 Miscellaneous Manufacturing Industries 39
    24 Railroad Transportation and Transportation Services 40, 47
    25 Local and Interurban Passenger Transit 41
    26 Trucking and Warehousing 42
    27 Water Transportation 44
    28 Transportation by Air 45
    29 Pipelines, except Natural Gas 46
    30 Communications 48
    31 Electric, Gas, and Sanitary Services 49
    32 Wholesale Trade 50-51
    33 Retail Trade 52-57, 59
    34 Banking and Other Credit Agencies 60-61, 67
    35 Security and Commodity Brokers 62
    36 Insurance Carriers 63
    37 Insurance Agents, Brokers, and Service 64
    38 Real Estate 65
    39 Eating and Drinking Places 58
    40 Hotels and Other Lodging Places 70
    41 Personal Services 72
    42 Business, Engineering, and Management Services 73, 87, 89
    43 Auto Repair, Services, and Parking 75
    44 Miscellaneous Repair Services 76
    45 Motion Pictures 78
    46 Amusement and Recreation Services 79
    47 Health Services 80
    48 Legal Services 81
    49 Educational Services 82
    50 Social Services 83
    51 Membership Organizations and Household Services 84, 86, 88
    52 Federal Government Enterprises
    53 State and Local Government Enterprises

    In addition to the output, employment, and income information on these 53 industrial sectors, each REIM contains information on roughly 13 final demand variables, including consumption, investment, and government expenditures, and 8 demographic variables defining major age and sex cohorts and migration.