The Locus One Pager

The Locus Model

The Locus Model is a systems-based model that characterizes economic entities, such as companies and jobs, across industry, scale, time, and geography.

We define an economic system as an entity that converts or acts on inputs to create outputs. This definition includes both entities that produce goods (resource products) and those that provide services (activity products). The model posits that all economic systems create these products by carrying out an activity cycle utilizing resources from six fundamental resource categories.

The most generalized activities and resources are listed below.

All economic systems can fit this model and are assigned an alphanumeric classification code, called a locus, based on its primary output. This code is a standardized expression of economic function (i.e., what an entity does). It is expressed using a verb-noun syntax (e.g., “2 B: Produce Equipment”). The complete model features increased granularity by subdividing activities and resources. For example, the activity of design (2.1) can be separated from production (2.2), and raw materials (B1) can be separated from finished equipment (B4).

We can more precisely implement the Locus Model by tagging entities with multiple functional codes to highlight supply chain distinctions, product use cases, specific customer attributes, and more. This broader set of functional information is captured using the Functional Barcode, which is a standardized tool for storing functional information about a specific economic entity.

By organizing and ordering economic systems according to Functional Barcodes, the Locus Model enables a deeper understanding of the moving parts of the economy. We continually refine our model as we pursue its applications, which include economic policy analysis, risk management, workforce development, and more.