LOCATION QUOTIENT OR LQ, A SIMPLE QUANTIFYING METHOD TO ASSESS COMPARATIVE ADVANTAGES

Abstract

This paper is aimed to socialize the use of Location Quotient or LQ as an
alternative method to quantify comparative advantages of commodities. It is a
simple and a useful method to understand the existingipotential of particular regions
and the meaning of information gained from that analysis for planning and or
development program. A practical case analysis was applied on the potentials of
cattle in Indonesia imder 26 provinces (Central Bureau Statistics, 2001). This
method will be meaningful if the other related data are considered, for example land
resources, economic density as the main ecological requirement and cattle
development indicator respectively. Discussions and cautions are noted in using this
method. Suggested, this method can be further developed properly and can be used
widely for agricultural and non-agricultural commodities.