Adaptive DSS design strategy for a regional socioeconomic balance sheet

Abstract

This article describes the concept of a socioeconomic (S-E) balance sheet and its uses; the implementation of a decision support system (DSS) for a specific organization using balance-sheet data and adaptive design criteria as suggested in current DSS literature. The basic idea and application of a S-E balance sheet is similar to that of a balance sheet for a business enterprise. However, the S-E balance sheet is expanded to include a labor inventory to account for human assets and some items of intangible capital such as education and water resources which contribute directly to the total assets of the region. The term ‘socioeconomic’ is used to distinguish between the expanded concept of a public sector balance sheet and the typical balance sheet which would measure only material wealth. The S-E balance sheet enables one to ‘add-up’ those main factors—tangible and intangible—which contribute, in a positive or negative sense to the total cumulative wealth of the region. The development of a regional S-E balance sheet is viewed from a ‘systems’ standpoint where one conceives of the regional economy as a complex structural whole, with various productive elements of the economy (government, business, labor, educational institutions, foreign investments etc), contributing to asset formation while producing claimants to the regional wealth. However, claims (that is, liabilities on the balance sheet) may be held by producers and non-producers alike. The disequilibrium between assets and claimants to these assets sheds light on the structure (and structural unemployment) of resources and resource ownership in the regional economy. The S-E balance sheet can be used as a forecasting and planning tool. In particular, it is used to show past priorities in terms of allocations of various resources (assets) and to develop projections which will show possible future allocations. The balance sheet is of use to researchers, planners, decision makers in private industry and public policy makers. The implementation of a regional S-E balance sheet based DSS has been made possible through the use of a powerful database management system and decision-support software named EXPRESS. The implementation strategy for the S-E balance sheet takes into account adaptive DSS design criteria suggested in the current literature. In essence, this involves the implementation of “expanding subsets of system capabilities based on an initial nucleus of extensible features.” An initial user of the S-E balance sheet based DSS is St. Clair County in Illinois for the purpose of allocating funds across 45 communities from the Community-Development Block Grant Program.