Introduction to Economic Geography

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Introduction to Economic Geography

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The Unemployment Rate 2000 to 2004
During the recent recession and recovery, the
unemployment rate varied over a 2 percentage
point range from a low of 4 to a high of 6.
The maximum year to year change was just over 1 .
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Unemployment Ratesby County in 2004
Unemployment rates varied geographically from 1.6
to 20.5 . Some counties had rates that were more
than 12 times that of others. Geographic
variation is much greater than national
time-series variation.
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Transitional Year 2003
2003 was a year in which the national economy
began its recovery. However, while the
unemployment rate was rapidly declining in some
counties (dark green), it was still rising
rapidly in other counties (dark red). Levels as
well as rates of change in unemployment rates
vary widely geographically across the country
even within regions and states.
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Average Unemployment 2000 to 2004
Unemployment rates do not necessarily average out
over time and place. Average unemployment rates
ranged from 1.9 to 17.1 percent across counties
in the US during this period. Some counties
averaged nearly 9 times the rate of others.
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Unemployment Ratesby Economic Area
With more than 3,000 US counties, such analysis
may be unwieldy. GIS enables aggregation of
county information by geographically interrelated
Economic Areas as defined by the Bureau of
Economic Analysis. Unlike state boundaries,
economic areas can cross state boundaries as
appropriate.
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Per Capita Income by EA
Other economic variables can likewise be
aggregated into meaningful economic areas, for
example, per capita income.
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Income Inequality by EA
. . . or income inequality (GINI Ratio). All of
these and many other economic measures vary
widely geographically and can be meaningfully
studied using GIS techniques.
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Geography Matters in Economics

• The geographic variation of economic variables
  are many times greater than the variation over
  time observed at national level over the time
  (economic cycle).
• Yet this enormous amount of variation is studied
  much less than that of the more limited variation
  observed in national time series data.
• GIS tools now enable new ways of understanding
  the workings of economic systems.

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Geographic Policy Problem

• Expansionary monetary and fiscal policy is
  generally used when national unemployment is
  high.
• But what is the effect of expansionary fiscal
  policy on an economic area that has an
  unemployment rate below 3 ?

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• Economics needs to focus more of its attention to
  the geographic aspects of economic problems and
  policies.