A Potential Model of Industrial Location Considering Input-Output Relationship and Development of Ports and Expressways

Abstract

We develop the potential model of industrial location, focusing on Kyusyu, Japan. In the potential model, some kinds of transportation cost of each region are explanatory variables, and the value of production by each industry in each region is an explained variable. Transportation cost is calculated from the Inter-regional Input-Output Table and the Industrial Statistics. Using the potential model of industrial location, we estimate the value of production in each region based on scenarios of developments of expressways and ports.