Spatial Economic Diagnostics

The problem

Regional and industrial planning decisions in South Asia and the GCC are persistently made without spatial evidence. Investment zones are designated on maps without analysis of economic concentration patterns, labour market catchments, or agglomeration externalities. Sector development strategies are prepared at the national level without disaggregating which sub-regions have the factor endowments and connectivity to actually host the targeted industries. Infrastructure corridors are aligned to political geography rather than economic geography.

The gap is methodological. Most planning consultancies operate with standard macroeconomic tools — input-output tables, CGE models, financial projections — but lack the capacity to integrate spatial econometric methods, GIS-based accessibility analysis, and establishment-level data into a coherent diagnostic. The result is strategy documents that look authoritative but cannot answer the fundamental question that drives investment decisions: where, specifically, does the economic logic hold, and where does it not?

Approach

Spatial economic diagnostics begin with the construction of an economic geography baseline: how is productive activity distributed across the territory, what clustering and specialisation patterns exist, and how have these patterns shifted over the analytical period? Location quotient analysis and shift-share decomposition — distinguishing national growth effects from regional competitive advantage — provide the foundation for identifying where economic concentration is structurally grounded versus where it reflects historical policy distortion or infrastructure accident.

GIS-based analysis layers accessibility, labour market catchment, land-use compatibility, and infrastructure service area data onto the economic baseline. Spatial autocorrelation techniques — Moran's I, LISA cluster mapping — identify genuine agglomeration economies and flag areas of spatial dependence that standard aspatial models would miss. Where establishment-level or firm-level microdata are available, spatial econometric regression models quantify the productivity premium associated with proximity, density, and connectivity — providing the empirical basis for location-specific investment recommendations.

Outputs are calibrated to the decision at hand. For a national spatial strategy, the diagnostic produces a territorial typology that stratifies regions by growth potential and policy priority. For an industrial location decision, it produces a scored site comparison matrix with explicit spatial criteria weights. For a transport or infrastructure investment, it maps the economic catchment and estimates the productive capacity unlocked by improved connectivity.

How engagements work

Spatial diagnostics assignments are typically structured as standalone analytical components within larger planning or investment mandates, or as independent advisory engagements of six to twelve weeks. Outputs are designed to integrate directly into World Bank, ADB, or national planning authority report formats. Remote delivery with periodic in-country presence is standard for GCC and South Asia mandates.