Regional Input-Output Tables and the FLQ Formula: A Case Study of Finland

Flegg A. T. and Tohmo T. Regional input - output tables and the FLQ formula: a case study of Finland, Regional Studies. This paper examines the use of location quotients (LQs) in constructing regional input - output tables. Its focus is on the modified FLQ formula proposed by Flegg and Webber in 1997. Using data for twenty Finnish regions of widely different size, a regression model is developed to assist in the selection of a value for the unknown parameter δ in this formula. It is found that the FLQ yields results far superior to those from standard LQ-based formulae. The FLQ-based initial set of regional input coefficients could be used to build the non-survey foundations of a hybrid model or as part of the RAS procedure. © 2013 Copyright Regional Studies Association

ENTREPRENEURIAL AND REGIONAL GROWTH ACTIVITY IN FINLAND

Audretsch & Feldman (2004) argue that an agglomeration is a collection of localized firms with a common focus. As firms thrive, resources are attracted to the region. They state that, if entrepreneurship serves as a mechanism for knowledge spillovers, measures of entrepreneurial activity should be linked positively to regional growth performance. In Schumpeterian economics the engine of economic development is entrepreneurial innovation. Creative destruction makes way for new innovations and growth. In this study, we simultaneously examine the regional entrepreneurial activity and regional growth activity in Finland. A further aim of the study was to find out if entrepreneurial activity and growth activity also play a deagglomerating role. We find, first, that the indicators used are very well suited to measure the dynamic environment, especially in manufacturing, since the regions with the most dynamic environment were areas with high small-business activity. Furthermore, the study indicates that growth activity should be taken into account when examining regional development by means of the concept of the dynamic environment. Secondly, we find that entrepreneurial activity and growth activity decreases regional specialization, i.e., the regions with the highest regional specialization are characterized by the lowest levels of entrepreneurial activity and growth activity. Our study confirms with Finnish data the findings of Dumais et al. (2002) that new plant births play a deagglomerating role. The results of the study indicate also that growth activity tends to act to reduce regional specialization. As a whole, the results suggest that the regional specialization is the result of a dynamic process in which the combination of plant births and growth act together.Dynamic environment, entrepreneurial activity, growth activity, regional specialization

Estimating Regional Input Coefficients and Multipliers: The Use of FLQ is Not a Gamble

© 2014 Regional Studies Association. Flegg A. T. and Tohmo T. Estimating regional input coefficients and multipliers: the use of FLQ is not a gamble, Regional Studies. This paper re-examines the Finnish evidence presented by Lehtonen and Tykkyläinen on the use of location quotients (LQs) in estimating regional input coefficients and multipliers. They argue that the choice of an LQ-based method is a gamble and that there is no single method that can be recommended for general use. It is contended here that this evidence is erroneous and that the FLQ (Flegg's location quotient) yields results far superior to those from competing formulae, so it should provide a satisfactory way of generating an initial set of input coefficients. The choice of a value for the parameter δ is also examined

Location quotient and trade

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