An evaluation of alternative measures of regional industrial diversification

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Abstract
Jackson R. W. (1984) An evaluation of alternative measures of regional industrial diversification, Reg. Studies 18, 103–112. Industrial diversity continues to be a goal in regional planning and policy contexts. While the concept has strong intuitive appeal, its definition and measurement suffer from problematic theoretical and statistical issues. An empirical analysis of the relationship between employment stability and four measures of diversity for multicounty regions in the State of Illinois is presented. The results indicate that the nature of the stability/diversity relationship is swamped by the measurement and estimation techniques employed. Current diversity measures are deemed inadequate for regional policy makers. The ensuing discussion highlights a number of conceptual and statistical issues which must be addressed by practitioners.