Data & Tools for Understanding Our State & Our Local Economies
September 29th, 2009
University of Nevada, Reno
Simulation Scenario #3 - BANKING SCENARIO
Situation & Setting
A newly minted-MBA uses REAP and in a matter of hours presents a brief overview of two tertiary economies for his regional bank.
Regional banks, bolstered by the cheap capital flood emanating from Washington D.C. and Wall Street, are jockeying for position to develop fast growing tertiary markets in the West. You are an MBA recently hired by a regional bank headquartered in Reno, Nevada. The bank is interested in expanding its reach in the areas of Minden (Douglas County) and Fernley (Lyon County). At 4:30 pm you're asked by the bank president to prepare a 12 minute overview presentation about the Douglas and Lyon County economies relative to the rest of the state of Nevada for the bank's board of directors by 9 am the next morning. BTW...you've invited your girlfriend to dinner and dancing that evening so you can pop the question.
The REAP website will allow you to meet this deadline. As a team, see how below!
Your Assignment
While you have the site open and at your fingertips, go through the following questions and use the site to find out the following information. Because the presentation is to evaluate these counties in comparison with each other and with the state as a whole, this is a perfect task for the LSGL Analysis module on the REAP site.
LSGL ANALYSIS: The LSGL module allows for a comparison of the two counties you are evaluating, both between themselves and the state as a whole. At this point, it is advisable that the team splits up, with each taking on a different economic measure for evaluation during step c (choosing between Employment, Total Personal Income, Industry Earnings, Population, and Per Capita Income). As you are conducting your portion of the analysis, take notes on which tables and figures produced through the LSGL Analysis module would be most compelling for your contribution to the presentation (hint: scatter-plots are frequently favored by finance and banking types).
On the left menu, click on "LSGL Analysis". This opens a menu where you may select the measures you are interested in evaluating for the bankers.
Click on "Employment" (or whichever measure you are responsible for)
Click on "Douglas" in the list of counties to the right hand portion of the screen.
Go through and follow steps a-d, substituting the other options (Total Personal Income, Industry Earnings, Population, and Per Capita Income) to perform LSGL Analysis on other measures.
Repeat the steps (a-f) for Lyon County which you are also evaluating for this analysis.
Look at the data from the LSGL Analysis above. Take turns making short presentations to your overall group on your area. In your subject area, which county is performing better, and how are they both performing as compared to the state as a whole? Considering that bankers are concerned with growth to a large extent, which measures should you include in your presentation?
LOCATION QUOTIENTS: These steps will show us the magnitude of concentration of employment and earnings for these counties. The bankers likely have significant interest in the underlying characteristics and industrial composition of the local regions.
On the left menu, click on "Industry Structure and Performance", "Industries by County", and "Employment"
Click "Douglas" in the menu to the right, then follow the same steps (a-c) for "Lyon" in a new browser window
Note the difference in employment location quotients between the counties. Note industries that have high location quotients (the third numeric column from the left in Table 1). Make sure to identify the industries that have a high level of concentration in the local economies in your presentation.
BRAINSTORM: (time permitting) There is a wealth of data at your fingertips on the REAP site. Browse the modules, and consider whether any of them offer additional information that could embolden your presentation.
CONSTRUCT YOUR PRESENTATION: Be sure to include the following in your presentation:
Comparative economic performance from LSGL Analysis
Location quotient analysis for information for each county
Any additional details you have gleaned from the REAP site that will inform your conclusions
A slide giving your official recommendations and the caveats that you should attach to this kind of "quick-and-dirty" analysis
Congratulations! You've just accomplished a great deal and put a great amount of material into a presentation in a short amount of time!
