An Analysis of Economic Changes in Chiang Rai Province Using the Location Quotient (LQ) Index and Shift-Share Analysis

Abstract

The primary aim of this study is to investigate the changes in economic activity within Chiang Rai province throughout the period spanning from 2012 to 2021. This investigation is conducted by employing the Location Quotient (LQ) index and Shift-Share methodologies. The overall results reveal that Chiang Rai demonstrated a higher proficiency in the agricultural sector relative to the national level, however; its proficiency has shown a decreasing trend. In the service sector, Chiang Rai has a slightly higher level of proficiency than the national average. Conversely, within the industrial sector, the province had a comparatively lower degree of competency in relation to the national level. When considering the LQ index in conjunction with Shift-Share analysis and the BCG matrix, it is suggested that, in the year 2021, three sectors of production, namely Education, Transportation and Storage, and Real Estate Activities, have strong potential and have been identified as leading industries. Meanwhile, the remaining 16 sectors of production require support and collaboration from the public and private sectors to boost competitiveness and market opportunities. The findings of this study can be used as information to drive policies for the economic development of Chiang Rai Province, particularly in relation to Special Economic Zones (SEZs) and the Northern Economic Corridor (NEC).