In 1989, after several years of discussion and negotiation, the Regional Econornics Applications Laboratory (REAL) was formed. This unique relationship between the Federal Reserve Bank of Chicago and the University of Illinois at Urbana-Champaign has been a significant source of intellectual inspiration for many students, visiting colleagues and members of the participating institutions for the past decade. The idea for REAL was hatched by Philip Israilevich and Geoffrey Hewings in typical Chicago style - in the back room of a local bar. In early December 1997, their collaboration came to an untimely end when Philip died after a three-year battle with cancer. The challenge of moving across a spectrum from theory to model development to implementation and interpretation provided the underlying motivation for REAL's formation together with an equally important component, namely the translation of many of these efforts into a form that could be understood and implemented by policy­ makers. For Philip, REAL and the Regional Science Association International provided the forums for his intellectual endeavors, although he also contributed many papers in banking. In recognition of his contributions and to provide a sense of the current research in the fields in which he published, many of the authors of these chapters assembled in Chicago in November, 1998 to participate in a small seminar in his honor. Several others who were not able to come nevertheless contributed chapters to this volume. Subsequently, all of the papers have been revised and updated.

1 Introduction.- I Trade and Transportation.- 2 Spatial Effects of European Transport Policy: a CGE Approach.- 3 Combined Model of Interregional Commodity Flows on a Transportation Network.- 4 Why Do Countries Pursue Reciprocal Trade Agreements? A Case Study of North America.- 5 The Regional Impact of Foreign Direct Investment: Structure and Behavior in an Ownership-Disaggregated Computable General Equilibrium Model.- 6 Economic Landscapes: An Application to the Brazilian Economy and to the Sugar Cane Complex.- 7 On the Economic Impact of the Transport Sector: A Critical Review with Dutch Bi-Regional Input-Output Data.- 8 The Influence of Transport Investments on Economy and Environment: An Analysis from the Perspective of Taiwan.- 9 The US Regional Ferrous Scrap Model.- II Structure and Structural Change.- 10 The RAS Structural Decomposition Approach.- 11 Structural Changes in the Chicago Economy: A Field of Influence Analysis.- 12 Modeling Structural Linkages in Dynamic and Spatial Interindustry Systems.- 13 Restrictions in Integrated Econometric+Input-Output Modeling.- 14 Regional Input-Output, Leontief-Strout and Uncertainty.- 15 Using the REAL Models to Understand Midwest Restructuring.- 16 Keystone Sector Identification.- 17 A Spatial Output Decomposition Method for Assessing Regional Economic Structure.- 18 New Explanatory Models for Analyzing Spatial Innovation: A Comparative Investigation.- 19 Vertical Specialization and Interregional Trade: Hierarchy of Spatial Production Cycles and Feedback Loop Analysis in the Midwest Economy.- 20 Miyazawa-Sraffa-Leontief Income Distribution Models.- III Methodological Issues.- 21 Frame-Shifting in Regional General Equilibrium Models.- 22 Input-output Systems in Regional and Interregional CGE Modeling.- 23 Direct and Indirect Industrial Pollution Generation: A Field of Influence Approach.- 24 Regional Economic Modeling in Denmark: Construction of an Interregional SAM with Data at High Levels of Disaggregation, Subject to National Constraints.