year | field

Research on Analytical Methods for Policy Performance IV
-Development of a Potential Model for Industrial Location with Consideration of Transportation Costs(A Case Study in Kyusyu Area)-

summary

Transportation costs of materials and goods have a great influence on productive activities (especially industrial location) through the prices of materials and goods, and many pieces of research have been done on the relation between the transportation costs and the industrial location. Previous researches have often summarized individual cases through interviews with companies concerning location trends. There are comparatively few pieces of research that quantitatively analyze the relation between inter-industrial input-output relationship and the industrial location or the relation between interregional trade structure and the industrial location.

In this research we develop the potential model of the industrial location, focusing on major manufactures ("Foods", "Chemical products", "Ceramic, stone and clay products", "Metal products", "General machinery" and "Electrical machinery") in Kyusyu, Japan. In the potential model, "Transportation cost of materials from import port," "Transportation cost of materials from domestic import port," "Transportation cost of materials from other factories inside Kyusyu," "Transportation cost of products to domestic export port," and "Transportation cost of products to the market" of each region are regarded as explanatory variables, and the shipment value of manufactured products by factories in each region is regarded as an explained variable.

Transportation cost is calculated from traffic volume and transit time between origin and destination. The traffic volume is the data relating to the input-output structure (how much input from or output to each industry) and the trade structure (input from or output to which regions), and the traffic volume is calculated from "Inter-regional Input-Output Table" for 1995 in Japan. The transit time is calculated with "National Integrated Transport Analysis System". The shipment values of manufactured products by industries in each region from the "Industrial Statistics" for 1985, 1990 and 1995.

Using the potential model of industrial location, we estimate the shipment values in each region based on scenarios of infrastructure developments such as expressway or ports.

issue

Reports No.72/2006 OCT.

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