Economic diversity is believed to enhance economic stability and growth by limiting the number of imports a local economy needs to sustain its current production and by providing increased availability of locally produced final demand purchases. The Shannon–Weaver (S-W) Diversity Index measures economic diversity on the basis of the number of Industries in a region and the distribution of employment across those Industries.
Generally, entropy methods measure the order or disorder found in the data. The S-W Index is an entropy method that measures the economic diversity of a region against a uniform distribution of employment; where the norm is equal employment in all Industries.
In other words, it is a measure of the extent to which the employment of a region is evenly distributed among its Industries. It ranges in value from zero to one, with zero indicating minimum diversity and a value of one indicating maximum diversity. A value of zero (complete specialization) occurs when the economic activity of a region is concentrated in only one Industry. A value of one (perfect diversity) occurs when all industries are present in the region, with employment spread equally among them.
DATA DELIVERY & SUPPORT:
The data will be provided in .xlsx files containing the S-W Index Data for the requested geographies and years. Users will have unlimited access to IMPLAN Community Forum at support.implan.com for questions specific to the data. IMPLAN economists will gladly respond to questions on IMPLAN’s Community forum within 5 business days at no additional charge. IMPLAN does not support data-application or related questions via email, phone, project consultation, or community forum.
The S-W Index is available for 2001 to the current Data Year (2018). The data is available for zip codes, congressional districts, counties, and states.
Access to the IMPLAN S-W Index Data is protected with a custom license agreement. The license agreement will be presented when you are ready to purchase data. Sorry, the lawyers make us do it.
Thorvaldson, J. & Squibb, J. (2017). An Expanded Look into the Role of Economic Diversity on Unemployment. The Journal of Regional Analysis & Policy, 42, 2, pp 137-153.
Written January 17, 2020