Implan multiplier changes questions

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    IMPLAN Forum
    Hi Eric, The multiplier basically boils down to 1. The proportion of Output that is made up of Intermediate Expenditures (IE) and Labor Income (LI). This matters not just for the directly-impacted sector but for all the input suppliers of that sector and all of their input suppliers, etc. The rest of Output (i.e., taxes and profits) are treated as leakages in the standard IMPLAN set-up. So the more OPI and TOPI there is for all affected sectors, the lower the multiplier will be. and 2. The proportion of inputs and household expenditures are bought locally (i.e., within the study area). The RPCs are on a commodity basis so it doesn't matter who the demander is (i.e., all industries and institutions are assumed to buy at the same local rate) so the RPCs will be the same for all rounds of indirect and induced. Another factor when considering employment multipliers in particular is the size of the Direct Employment relative to Output. While employment itself does not generate any impacts (all indirect impacts stem from IE and induced impacts stem from LI), its initial value is included in the multiplier calculation so it will affect things. In 2010, the number of workers per dollar of output was much lower than in 2012 (stated differently, output per worker fell between 2010 and 2012) so you had a smaller denominator when calculating the employment multiplier (i.e., you started with a smaller employment so any additional indirect and induced employment stemming from the IE and LI look bigger relative to the direct, when compared to 2012). There has not been any change between the 2010 data year and now in terms of how we calculate Foreign Trade for the U.S. (which influences the RPC). Thanks!
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