A unique toolbox for analysing alternate scenarios
Oxford ’s International Cities and Regions Forecasting Models, which are linked to our Global Economic and Industry Models, provide a unique set of tools for conducting rigorous "what if" scenario analysis.
Looking at the implications of both key economic risks and the prospect of market changes for over 3,000 locations worldwide, the models can address a variety of issues, such as:
- How hard would a disintegration of the Eurozone affect the performance of different cities across Europe?
- What would be the implications of oil prices hitting $200 per barrel for the demand for office space compared with retail and industrial space?
- Which cities have been hardest hit by fiscal austerity measures?
- How would a hard landing in China affect the future growth of cities across Asia?
You can use our scenarios to test the robustness of your business plans or investment strategies; to consider the risks involved in entering a new market; or to analyse the implications of public policy changes on the performance of the local economy.
In addition, Oxford Economics can develop new city and regional models on your behalf, or provide enhancements to our existing models to address the issues you need to analyse. We have worked in this way to provide detailed systems forecasting clients’ demand for real estate, public services and infrastructure, and helping governments assess the impact of different regional economic development policies.
Our models are delivered in a very user-friendly format, with full training and ongoing support from our economists. Or we can operate the models for you as an outsourced economics resource to provide the insight you need to inform and support your decisions.
How custom city modelling can work for you
Our suite of International Cities and Regions Forecasting Models, integrated with our Global Economic and Industry Models, gives you access to detailed data on over 3,000 locations worldwide and a global team of over 90 economists. This gives us the flexibility to provide a wide range of tools:
Model building—Our extensive experience in building and maintaining local-area models provides an ideal base to help you develop your own models for forecasting and scenario analysis. We can also extend our existing Cities and Regions Models to look in more detail at additional indicators relevant to your organisation.
Risk scenarios—Our models can quantify the implications of "what if" scenarios, which may reflect specific economic, political, social, or policy risks. As well as advising on the key risks you need to watch for and their likelihood, we are also able to offer tailored advice on the implications for locations that are critical your business.
Policy analysis—We quantify the effects of both national and regional/city policy changes for city performance and competitiveness.
Training and capacity building—Our tailored programmes are designed to help you and your team use our models effectively to support your organisation’s decision-making.
Commercial real estate scenarios
Client: Jones Lang LaSalle (JLL)
Together with Jones Lang LaSalle, we have built a model to support their European commercial real estate forecasts. These cover rents, yields, capital values and other key variables for offices, shops, and industrial properties in over 40 cities in Europe. The model allows changes in the economic drivers, together with developments on the supply of property to affect the outlook for real estate markets.
According to JLL, “The ability to tap into [Oxford Economics'] forecasting models has brought both a robust forecasting backbone, combined with some innovative approaches to forecasting, to the commercial real estate sector. Their strong academic background and continuing ties with the world’s leading academic institutions means our forecasts stay up to date with the latest innovations and thinking within the sector.”
An economic model of New York/New Jersey
Client: Port Authority of New York/New Jersey (PANYNJ)
We developed an additional module for our global economic model (GEM), to provide forecasts for key economic variables in the New York/New Jersey area. These include output and employment across 12 sectors, including a range of service industries, production, construction and the public sector. Using the GEM, PANYNJ are able to track the impacts of changes in the macroeconomic outlook on the economy of their region, as well as use our own scenarios (and produce their own) to simulate shocks such as a euro break-up or a sharp rise in oil prices. In addition, we supply PANYNJ with a further Excel spreadsheet showing how a given economic outlook for the region affects the counties. These impacts are based on their industrial makeup and other structural relationships between the local area and the wider economic environment. Finally, we provide PANYNJ with a tool that enables them to link the scenarios generated within the GEM with the outlook at a county level, allowing them to isolate the locations most vulnerable to economic shocks in the future.