Economic Analysis

Economic Analysis


▪ Understanding Your Regional Economy

▪ Assessing the State of Regional Economy

▪ Economic Base AnalysisTechniques

▪ Evaluating Regional Economies

Introduction to Economic Models

New economic investments have multiple benefits
▪ The regional workforce, particularly those seeking employment

▪ The construction industry, which could gain additional contracts

▪ Regional businesses and firms, which might expect an increase in
demand for their goods

▪ The city and county governments may benefit from additional tax

Introduction to Economic Models

▪ Planners working for the local and regional governments consider
the implication of such possible investments
▪ Land use planners think about potential locations

▪ Transport planners examine the proposed locations to ensure that they
are strategically located

▪ Economic development (ED) planners predict how industry output,
employment, and income for residents and the government might be
affected by the increase in economic activities

▪ ED planners develop an impact analysis using multipliers to
estimate changes in the regional economy resulting from the
proposed investment plans
▪ Direct effect: New jobs
▪ Indirect effect: new income that will be spent within the region

▪ Multipliers are one way to estimate the total effects on employment
as a result of new economical investment
Introduction to Economic Models

Understanding Your Regional Economy

Circular Flow of Income and Expenditure
▪ Allows assessment of total changes in economic activity that result
from changes in exogenous spending

▪ Expected increase in demand for regional goods and services has to
be a “multiple” of the initial change in exogenous demand

▪ A widely used approach for creating a visual image of a regional
economy is based on the circular flow of income and expenditure

Circular Flow of Income and Expenditure

Three economic agents or decision makers

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