Calculating Household Income Change Impacts

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    IMPLAN Forum
    Hi David, Thank you for your post! You are correct, for a Household Income Change, IMPLAN runs the impact on the disposable income. As a point of clarification, we use the term "disposable income" to mean all spending whereas it is often used to define 'discretionary spending' the spending that occurs after the basic needs (food, shelter, utilities, etc) are covered. LPP should be set to 100% if the impact of Household spending their money will happen in the geographical region you built your model on. The Household Income may not have been received in this geographical region but the impact you are looking at is how their disposable income impacts the region they live in. To get these splits, you will need to import an Household Spending Pattern as you will not be able to look at the Indirect Impacts from a Household Income Change. Select Activity Options > Import > Institution Spending Pattern > Select the Household Income level. You can do this in the same Model, you will just have 2 Activities in the Model. AS an additional note, the value of expenditures is put into the Activity Level and must be just our version of disposable income (no payroll or personal taxes, no savings, no in-commuting income) because everything is spent in the spending pattern. The other advantage is that if you want to 'change' that definition of disposable income you can do so with this spending pattern because you can edit out items you don't want included. Thanks
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    David Borges
    Thanks. One point of clarification: do I also need to remove income taxes from the value I input as an activity change or will the model do that for me once I run it?
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    IMPLAN Forum
    Hi David, I want to be sure that I had accurately explained the difference between the Household Income Change and the Household Spending Pattern: Household Income Change: With a Household Income Change, the software will not remove payroll taxes, social insurance taxes, or commuter spending, but will still remove personal taxes and savings. With these first two options, the spending is said to be "induced" by the new income and all the effects are considered to be induced. Household spending pattern: All of the specified amount is spent (i.e., none goes to savings, payroll taxes, or personal taxes). This option is often used for tourism studies since the spending pattern is treated as a final demand and the results show direct, indirect, and induced effects. Here is the forum post where this definition was generated from: http://implan.com/index.php?option=com_kunena&view=topic&catid=84&id=13274&limitstart=6&Itemid=1840#13517 Thanks!
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