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In this paper, we develop the dynamic regional economic model. The fundamental framework of our model is based on the dynamic interregional input-output approach. A social optimization problem for the regional economy is formulated. We focus on the transportation infrastructure. The networks are composed of general road, highway, rail way, seaway and airway. A social welfare function is maximized subject to the inter temporal constraints of product and labor markets, and the capital accumulation. The optimal control theory is applied to examine the optimum condition. We consider the social accounting matrix and price system of the model. We derive the dynamic optimal solution by numerical computation. A prototype simulation model is proposed to evaluate a large dynamic optimization problem. We also show numerical results for the regional interaction and the optimal dynamic path. The Interregional input-output analysis is a major artery in regional science. A large number of studies have made on the Interregional analysis. Leontief [8] is the pioneer work of the input-output model. Isard [5] and Moses [8] advanced the single input-output structure to the interregional framework. Bargur [1] and Mather [10] attempted to make the linkage of the input-output model with a linear programming. Bargur formulated a linear programming form of the input-output model. Mather constructed a model to examine interregional investment allocation. Lundqvist [9] developed more advanced framework of dynamic model. The linkage with the transportation system was performed by Moses [12] and Batten [2]. Our model is a generalized version of Moses [12]. An application of a discrete type of dynamic interregional input-output programming model can be found in Kohno and Higano [6]. The formulation of our model is based on the Kohno and Higano Model. Some aspects are extended to deal with a large optimization model. Firstly, our model includes non-linear factors in the utility, production and cost functions. Secondly, we apply the optimum control theory and the numerical method to a large optimization problem. Thirdly, the economic structure of 47 prefectures in Japan is considered. The main purpose of this paper is to advance the frontiers of the large nonlinear optimization problem of the dynamic inter

The Dynamic Interregional Intersectoral Model: A Numerical Experiment of the Regional Economy in Japan