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The stability of the regional share component: some further evidence

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Abstract

The shift and share method of regional analysis has definite appeal as a projection device, and has received both considerable attention in the literature and wide usage in recent years. One of the principal criticisms of the technique is that the regional share component of the model is unstable over time. The purpose of this paper is to provide further evidence on the debate regarding the stability of the share component using correlation analysis. This paper provides a test of the hypotheses of James and Hughes that (1) the component is possibly unstable for certain industries while being stable for others and (2) the stability varies across state or other geographic regions.

The results do not support the conclusion that the share component is so highly unstable that the shift and share model is unusable as a projection technique. The tests indicate that the share component is stable for 23 of the 29 individual industries. The share component also proved stable for a majority of tests at the multi-state and state level of geographic disaggregation while being unstable for sub-state regions.

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Authors and Affiliations

  1. Department of Real Estate and Urban Development, The University of Georgia, USA

    Charles F. Floyd (Associate Professor and Doctoral Candidate) & C. F. Sirmans (Associate Professor and Doctoral Candidate)

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  1. Charles F. Floyd
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  2. C. F. Sirmans
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Floyd, C.F., Sirmans, C.F. The stability of the regional share component: some further evidence. Ann Reg Sci 9, 72–82 (1975). https://doi.org/10.1007/BF01287426

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