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Puget Sound Area

Exercise: My County's or Metropolitan Region's "Location Quotients"

(http://faculty.washington.edu/krumme/350/exercises/lq.html)

Exercise::

The purpose of this exercise is to gain a very basic understanding of the relative size and role of different economic activities in your county or metropolitan area and of the use of the "location quotient" to measure the unevenness in the distribution of these activities, however inadequately. I want you to use employment or occupational data even if you feel that your "field" of interests is not directly employment related. Find employment or occupational categories which come closests to what you have in mind as a field. If in doubt, send me an Email... If you feel that you should use demographic data (such as Asian immigrants) for L.Q. calculations, please do so in addition to your employment or occupational L.Q.s

1. Formulate one or two simple questions or propositions which are related to the relative importance of some employment facet related to your topical specialization (such as "retail activities") in the context of your county or metropolitan area ....

2. Calculate the full slate of location quotients for "all" economic activities (possibly after appropriate aggregation of categories other than those important for your topical field) in your county or metropolitan area using Washington State AND the United States as the benchmark regions. In addition, calculate at least one LQ (which relates to your topical interests) using a third benchmark region (such as the "Pacific Northwest" or the "Pacific States" or "all Westcoast Metropolitan Regions".
   1. Be very explicit as to how you did your calculations.
   2. Be very specific as to the data you have used (so that any reader can readily replicate your calculations). [You will find a more complete hypothetical example here]

   Activity Code (SIC or NAICS)	Industry	Employment 199?/200? Kitsap County	Employment 199?/200? Washington State	Location Quotients	Employment 199?/200? United States	Location Quotients
   20	Food Products	xxxxx	yyyyy	.853*	zzzzz	.943*
   etc.	etc.	etc.	etc.	etc.	etc.	etc.
   etc.	etc.	etc.	etc.	etc.	etc.	etc.
   etc.	etc.	etc.	etc.	etc.	etc.	etc.
   etc.	etc.	etc.	etc.	etc.	etc.	etc.
   etc.	etc.	etc.	etc.	etc.	etc.	etc.
   Total	---	XXXXX	YYYYY	(1.000)	ZZZZZ	(1.000)

   
   * hypothetical numbers
   3. Write a paragraph interpreting your results.

   4. Suggested total length: table + some questions + 1 interpreting paragraph

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   Location Quotient Formula:

   		 Employment in retail activities in Island County
                     -----------------------------------------------
   		  Total employment or population of Island County
         L.Q. =   =====================================================
          	        Employment in retail activities in Washington State
   	         --------------------------------------------------
   	         Total employment or population of Washington State
   

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   Internet Sites:

   Data Sites:
   • County Data
   • U.S. Census Data
   • Demographic & Population Data
   • Washington State - Employment Security Department: Labor Market Information [http://www.wa.gov/esd/lmea/curremp/curremp.htm]
   • The SIC system is being replaced by the North American Industrial Classification System (NAICS)
     • 1997 NAICS Matched to 1987 SIC Manufacturing, part (NAICS 336-339)
   • County Business Patterns County Business Patterns is an annual series that provides subnational economic data by industry. The series is useful for studying the economic activity of small areas; analyzing economic changes over time; and as a benchmark for statistical series, surveys, and databases between economic censuses. Businesses use the data for analyzing market potential, measuring the effectiveness of sales and advertising programs, setting sales quotas, and developing budgets. Government agencies use the data for administration and planning.
     • County, State, MSA, ZIP Code, or U.S. Database on a NAICS Basis (1998 and 1999)
     • County, State, ZIP Code, or U.S. Database on an SIC Basis (1993, 1994, 1995, 1996, and 1997)

   • Occupational Classification System
     • Occupational Data for 1999 by Metropolitan Areas

   • Enterprise Statistics [as different from establishment oriented statistics]

   Location Quotients: [Examples only]

   • L.Q.: Definition [Slide]
   • Hoover, An Introduction to Regional Economics, Ch.8, Appendix [www.rri.wvu.edu/WebBook/Giarratani/chaptereight.htm#app8-2]
   • Membership Location Quotient, National Council for Geographic Education (NCGE) is an organization established to enhance the status and quality of geography teaching and learning.
   • Excel based L.Q. Exercise (Foust, Wisconsin)
   • Professor Stutz' Location Quotient site
   • A Primer on Using the L.Q. for Identifying the Local Economic Base
   • Location Quotients for King County (WA)
   • Tim Chapin's Location Quotient Analysis [Florida State University]
     • King County Examples [Chapin]
   • Grant Thrall's Location Quotients [Location Quotient: Descriptive Geography for the Community Reinvestment Act]
   • Which Industries are Important to Connecticut? [By Jungmin Charles Joo, Associate Research Analyst, State of Connecticut]
   • High-Tech (Employment) Location Quotients for Wales vs. U.K.
   • Use of Location Quotients for calculating regional coefficients

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   Literature:

   "Identifying Service-Sector Exports from Major Texas Cities," Economic Review (Federal Reserve Bank of Dallas), July 1990.

   Flegg, A.T., C.D. Webber, and M.V. Elliott, "On the Appropriate Use of Location Quotients in Generating Regional Input-Output Tables," Regional Studies 29(6), October 1995, pp.547-61.

   Hoover, Regional Economics (Full text online)

   • Appendix with introductory explanation of Location Quotient
   • Table with L.Q.s for Urban Places by Size (1954)

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   Return to: Exercises || Geography 350 || Econ & Bus Geography
   2002 [econgeog@u.washington.edu]