TEXTBOOK: AnnaLee Saxenian, Regional Advantage: Culture and Competition in Silicon Valley and Route 128

Class Notes: Regions: Theory, Cases and Policy

COURSE DESCRIPTION: A regional economy is a system, an entity made up of separate parts that interact. The purpose of this course is to study the parts of a regional economy and how they fit together. One aspect of this is the spatial economics of a region and regional systems. As one regional economist, Edgar Hoover, puts it, "What is where and why--and so what?" There is an emphasis in regional economics on relating locational decisions to economic models of behavior and market structures. One line of analysis relates locational decisions for plants to sources of raw materials, locations of markets, and transportation costs of goods raw materials versus finished products.

Some industries supply markets which are outside of the region. These industries are crucial to the local economy and are called the economic base of the region. The course covers the economic base model of a region and the methodology of regional income and employment multipiers. There are dynamic aspects as well as static aspects of the model.

The relationships of the industries within a region are most easily analyzed in the format of Leontieff's input-output analysis. This methodology may also be extended to cover interregional relationships. Gravity models also play a role in describing the relationships within a region. In addition, agglomeration is an essential concept in understanding regional and urban phenomena.

A major goal of the course is to develop models of land use and the spatial structure of urban areas. This will involve examining several abstract models of land use.

Labor market areas and housing market areas, which are concepts closely related to the structure of a region, will also be covered. The course will tie occupational labor market markets and residential housing markets into the ethnic composition of the region and the socio-economic impacts of policy decisions.

The course also covers social accounting systems which measure regional product and regional income. The conceptual problems and information requirements make regional accounts more difficult than national income accounting.

GRADING: Grades will be based upon two midterm examinations, one final examination, and homework assignments. Each examination will count thirty percent and the homework will count ten percent. The examinations are of the multiple choice type except for makeup examinations, which are of the essay type. Makeup examinations are given only on the last day of the final exam period.