Regional Input-Output Tables and the FLQ Formula: A Case Study of Finland

International audienceThis paper examines the use of location quotients (LQs) in constructing regional input-output tables. Its focus is on the modified FLQ formula proposed by Flegg and Webber (1997). Using data for 20 Finnish regions of widely different size, we develop a regression model to help select an appropriate value for the unknown parameter δ in this formula. We find that the FLQ yields results far superior to those from standard LQ-based formulae. An FLQ-based initial set of regional input coefficients could be used to build the non-survey foundations of a hybrid model or as part of the RAS procedure