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

This paper examines the use of location quotients (LQs) in constructing regional input-output models. Its focus is on the augmented FLQ formula (AFLQ) proposed by Flegg and Webber, 2000, which takes regional specialization explicitly into account. In our case study, we examine data for 20 Finnish regions, ranging in size from very small to very large, in order to assess the relative performance of the AFLQ formula in estimating regional imports, total intermediate inputs and output multipliers, and to determine an appropriate value for the parameter ? used in this formula. In this assessment, we use the Finnish survey-based national and regional input-output tables for 1995, which identify 37 separate sectors, as a benchmark. The results show that, in contrast with the other LQ-based formulae examined, the AFLQ is able to produce adequate estimates of output multipliers in all regions. However, some variation is required in the value of ? across regions in order to obtain satisfactory estimates. The case study also reveals that the AFLQ and its predecessor, the FLQ, yield very similar results. This finding indicates that the inclusion of a measure of regional specialization in the AFLQ formula is not helpful in terms of generating superior results.Regional input-output models Finland FLQ formula Location quotients

Does Expansion Cause Congestion? The Case of the Older British Universities, 1994 to 2004

This paper examines whether the rapid growth in the number of students in British universities in recent years has led to congestion, in the sense that certain universities’ output could have been higher if this expansion had been less rapid. The focus of the paper is on 45 older universities that were in existence prior to 1992. The analysis covers the period 1994/5 to 2003/4. Several alternative methods of measuring congestion are examined and, to check the sensitivity of the results to different specifications, three alternative DEA models are formulated. The results indicate that congestion was present throughout the decade under review, and in a wide range of universities, but whether it rose or fell is uncertain, as this depends on which congestion model is used. A crucial point here is whether one assumes constant or variable returns to scale. Nonetheless, all models point to a rise in congestion between 2001/2 and 2003/4, and this may well be a result of the rapid growth that occurred in this period. All models also record a sharp drop in mean technical efficiency in 2003/4. A possible explanation of the absence of a clear-cut trend in congestion is that the student : staff ratio in these universities was relatively stable in the decade under review, rising only gently from 2000/1 onwards.British universities; congestion; DEA

Does it matter How We Measure Congestion?

This paper examines three alternative methods of measuring congestion, from both theoretical and empirical perspectives. These methods are the conventional approach of Färe and Grosskopf, the alternative proposed by Cooper et al., and a new method developed by Tone and Sahoo. Each method is found to have merits and demerits. The properties of the different methods are examined using data for 41 ‘new’ British universities in the period 1995/6 to 2003/4. Contrary to expectations, Färe and Grosskopf’s approach generally indicates substantially more congestion than do the other procedures. The main reason for this is identified as being its use of CRS rather than VRS as the assumed technology. While the alternative measures of congestion are found to be positively correlated, the correlations are not strong enough for them to be regarded as substitutes. All methods suggest the existence of a widespread problem of congestion in the new universities, although they differ noticeably as regards its severity.Length: 37 pagesData envelopment analysis; Education; Congestion;

Are the New British Universities Congested?

This paper uses data envelopment analysis (DEA) to examine the issue of congestion in British universities. The focus of the paper is on 41 former polytechnics that became universities in 1992, and the analysis covers the period 1995/6 to 2003/4. These new universities differ from the older universities in many ways, especially in terms of their far higher student : staff ratios and substantially lower research funding per member of staff. The primary aim of the paper is to examine whether this under-resourcing of the new universities has led to ‘congestion’, in the sense that their output has been reduced as a result of having too many students. Three alternative methods of measuring congestion are examined and, to check the sensitivity of the results to different specifications, three alternative DEA models are formulated. The results reveal that a substantial amount of congestion was present throughout the period under review, and in a wide range of universities, but whether it rose or fell is uncertain, as this depends on which congestion model is used. The results indicate that an overabundance of undergraduate students was the largest single cause of congestion in the former polytechnics during the period under review. Less plausibly, the results also suggest that academic overstaffing was a major cause of congestion! By contrast, postgraduates and ‘other expenditure’ are found to play a noticeably smaller role in generating congestion.British New Universities; congestion;