Regional Economic Modeling

Regional economic models can serve as valuable tools for corporate and regional planners by providing information and forecasts of economic conditions at the local level. Since every region is unique in its industrial makeup and general economic environment, specific effort in examining the local economy as an economic engine of its own can prove rewarding. Often, economic conditions and trends seen at the national level are quite different from the experiences of individual regions. Hence, valuable information can be gained by taking a grass roots regional approach to economic analysis.

REAL’s primary modeling efforts are focused on the construction and use of Regional Econometric Input/Output Models (REIMs). Each REIM is constructed from the ground up, using information as detailed as plant level purchases and sales. Since completion of REAL’s first model, the Chicago Region Econometric Input/Output Model (CREIM), in 1989, REAL has continually updated and refined collection and estimation techniques to maximize the informational content of each model while maintaining a high degree of accessibility.


The REIMs designed by REAL are structured to serve a wide range of user’s specific economic planning and analysis needs. Common uses of these REIMs by our clients include:

Impact analysis: estimating the effects of specific economic events on local industries.

Market analysis: evaluate market structure and dynamics by analyzing the purchases and sales of goods between industries over time.

Efficiency comparisons: compare specific business attributes, such as purchases and labor costs, to industry averages.

Economic analysis: examine general economic trends for the local economy


REAL’s portfolio of economic models covers regions throughout the Midwest, the eastern United States and the world. Currently, there are models completed or under construction for the following regions:

US StatesUS Metropolitan RegionsInternational
IllinoisChicagoStyria, Austria*
IndianaSt. LouisCeará, Brazil*
IowaWashington D.C.Minas Gerais, Brazil
MichiganNorthern VirginiaSâo Paulo, Brazil
OhioCartagena, Columbia*
VirginiaJakarta, Indonesia
* Under construction

 If you are interested in renting or purchasing one or more of the models listed above, or wish to inquire about the construction of a model for a region not listed, please contact REAL.


Each model is packaged within a custom-designed windows based software. The software itself is specifically designed to allow users easy access to all facets of the REIM. At the click of the mouse, access can be gained to economic analysis information for your region.


For most US models, each industry within an economy is assigned to one of the 53 core business sectors defined by REAL. Sector definitions are roughly based on the two-digit level of the Standard Industrial Classification (SIC) code system. For each sector, historical and forecasted values are available for output, employment, and income. Additionally, yearly, on a sector by sector basis, volume estimates of purchases and sales between each sector is available for structural and efficiency analysis. Upon request, custom sectoring schemes can be provided. The industries defined within each US REIM are as follows:

1Livestock, Livestock Products, and Agricultural Products01-02
2Agriculture, Forestry and Fisheries07-09
3Mining10, 12-14
5Food and Kindred Products20
6Tobacco Products21
7Apparel and Textile Products22-23
8Lumber and Wood Products24
9Furniture and Fixtures25
10Paper and Allied Products26
11Printing and Publishing27
12Chemicals and Allied Products28
13Petroleum and Coal Products29
14Rubber and Miscellaneous Plastics Products30
15Leather and Leather Products31
16Stone, Clay, and Glass Products32
17Primary Metals Industries33
18Fabricated Metal Products34
19Industrial Machinery and Equipment35
20Electronic and Other Electric Equipment36
21Transportation Equipment37
22Instruments and Related Products38
23Miscellaneous Manufacturing Industries39
24Railroad Transportation and Transportation Services40, 47
25Local and Interurban Passenger Transit41
26Trucking and Warehousing42
27Water Transportation44
28Transportation by Air45
29Pipelines, except Natural Gas46
31Electric, Gas, and Sanitary Services49
32Wholesale Trade50-51
33Retail Trade52-57, 59
34Banking and Other Credit Agencies60-61, 67
35Security and Commodity Brokers62
36Insurance Carriers63
37Insurance Agents, Brokers, and Service64
38Real Estate65
39Eating and Drinking Places58
40Hotels and Other Lodging Places70
41Personal Services72
42Business, Engineering, and Management Services73, 87, 89
43Auto Repair, Services, and Parking75
44Miscellaneous Repair Services76
45Motion Pictures78
46Amusement and Recreation Services79
47Health Services80
48Legal Services81
49Educational Services82
50Social Services83
51Membership Organizations and Household Services84, 86, 88
52Federal Government Enterprises
53State and Local Government Enterprises

In addition to the output, employment, and income information on these 53 industrial sectors, each REIM contains information on roughly 13 final demand variables, including consumption, investment, and government expenditures, and 8 demographic variables defining major age and sex cohorts and migration.