Comparison of non-survey approaches for the regionalization of input-output tables: a case study on Lower Saxony, Germany

Regional analyses are important to address spatial disparities in economic structures, but regionalization is often constrained by limited data availability. This study applies three established approaches to regionalize input-output tables (IOTs), Cross Hauling Adjusted Regionalization Method (CHARM) and two location quotient (LQ)-based approaches to analyze the economy of Lower Saxony, Germany. Three research questions are addressed: (1) How does the construction process for regional IOTs differ across the various approaches? (2) How do CHARM- and LQ-based approaches vary regarding the interpretation of regional economies? (3) What insights can be derived for Lower Saxony? The different conceptions and data requirements of the approaches affect both the construction process and the analysis. CHARM allows for the complete regional IOT construction whereas the LQ approaches do not enable detailed final demand representation. Using linkage analysis, multiplier analysis, and the hypothetical extraction method, the findings indicate that CHARM emphasizes supply-based trade flows and consumption-based effects, while the LQ-based approaches provide deeper insights into intermediate production structures. Differences in linkages and multipliers are more pronounced in import-dependent sectors. Regarding Lower Saxony’s economy, the results indicate a high degree of regional self-sufficiency. Manufacturing plays a central role in Lower Saxony, with its hypothetical extraction reducing total output by around 40%. High gross value added multipliers are observed in education and real estate. Energy supply dominates both greenhouse gas emissions and water use multipliers, reflecting the current relevance of fossil fuels. Overall, both regionalization methods provide valuable insights and should be seen as complementary.