Measuring the Regional Economy: Specialization and Diversity (VIDEO)

In this video lecture module, Adrienne Johnson, Director of Research for Economic Development Growth Engine for Memphis and Shelby County (TN), lays a foundation for economic modeling and a deeper understanding of your regional economy. Specifically, Johnson examines how researchers define and measure a region’s economy using industry specialization and diversification.  

The module addresses the following key questions: 

• Why are specialization and diversity important?  

• How is a region defined? 
• What are the steps to finding and analyzing a region’s economic strengths?  

Answering these questions will prepare you to perform economic modeling, an essential analytic skill for your research.

Johnson explains and demonstrates the following:

• How public data is used to analyze specialization in a region.
• What a Location Quotient (LQ) is, how it is used, and how to calculate it.
• What different LQ values indicate about a region’s economy.
• Basic guidelines for interpreting Location Quotients.

The next module will provide you with an opportunity to gain greater familiarity with this analytic tool–for both identifying/measuring local specializations and gaining insights into the range of a region’s economic diversification.