Tài liệu Real Estate and Regional Economic Growth doc

MIT Center for Real Estate
Week 12: Real Estate and
Regional Economic Growth
• Exports, transfers, investments and the
determinants of regional growth: demand.
• Population growth and migration: supply
• 3-Q model of regional response. Factor
supply elasticity and the role of real estate.
• Wages, productivity and real estate costs –
across MSAs.
MIT Center for Real Estate
Income and Product Accounts in States
Summary of Output and Income Accounts
for Florida and Pennsylvania, 1991
Florida ($ billions) Pennsylvania ($ billions)
Income Accounts*
Income (Y) 262 242
Wages (w) 126 127
Other Income (y + G) 136 115
Consumption (C) 260 193
Private 214 161
Government 46 32
Federal Taxes (T) 38 41
Savings (S) -36 8
Output Accounts**
Output (Q) 219 211
Wages (w) 126 127
Profits and Rents (π) 93 84
Consumption (C) 260 193
Investment (I) 44 27
Imports (M) 175 153

Exports (X) 92 144
INCOME (Y) - OUTPUT (Q) 43 31
MIT Center for Real Estate
Regional Accounts: Flow of Funds
• Regions do not have to have individually balanced
accounts. Surpluses in goods can be balanced by deficits in
capital or government flows: the following cross border
flows however must sum to zero.
Trade surplus: X-M [exports - imports]
Gov. surplus (Federal): G-T [spending – taxes]
Capital surplus: I – S [investment - savings]
Profits surplus: y - π [received - earned]
• Notice the in Florida, huge trade deficit is made up with
huge negative savings.
MIT Center for Real Estate
Sources of Regional Demand .
• Some variables are determined directly by the size of a
state’s economy (Income or Output) : imports (M), Federal
Taxes (T), consumption or savings (S) and profits earned
in the state (π).
• Other variables are determined by forces largely outside of
the region and serve to bring money into the state,
generating growth and ultimately determining state size
(level of income or output):
- Exports (X)
- Investment (I)
- Federal spending (G)
- Unearned income: SS, retirement…(y)
MIT Center for Real Estate
Characterizing Export growth and Investment?

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Share | Mix Competitive |
Shift
(i): industry
n,e: regional growth in activity, level of activity
N: national growth of activity

• Share: a matter of timing
• Mix: Historic industrial structure
• Competitive: “our” companies versus “theirs”
[innovation –vs- production costs: “product cycle]