Basic Report

This paper presents a method adopting the notion of balanced regional development in evaluating local financial investments. Specifically, we propose an objective regional development index to assess the degree of regional development and reflect them in the phase of evaluating local financial investment projects so to foster balanced development nationwide.
  
   The notion of balanced development in this study considers the imbalance in power among local administrative governments. We here focus on presenting the practical guidance of adopting the notion of balanced development in evaluating local investment projects rather than dealing with theoretical aspects. In addition, the units of local governments to which we apply the proposed method are 229 si-gun-gu.
  
   A review of the current decision-making system on investment projects reveals that although balanced development is actively considered in the prefeasibility study, there are some weakness in methods. On the other hand, the feasibility study on the Local Finance Act does not reflect the notion of balanced development. Thus, it is worth exploring a method to address it.
   Next, we render two indicators(underdevelopment, weakness) showing the degree of development for the classification of regional development. Common indicators represented underdevelopment are selected in population, income and financial aspects. Specified indicators by project field related to roads and park projects, which are representative of ‘linear’ and ‘area’ projects.
  
   According to the review, two population indicators (population density, population growth rate) and three income fiscal indicators (fiscal self-reliance, per capita income tax, and standard public land price) were selected, while the main indicators for each area selected a single road weight index, and urban park area and green land rates per person in the park area.
  
   The method proposed in this study is to consider ‘balanced development score’ in the policy analysis. The quantification method of the Balanced Development Analysis is to assess them in a metric structure for separating regional underdevelopment and weakness in the project field. As shown in the table below, scores are given based on a perfect score of 25, considering both regional ratings and project needs.