The U.S. Bureau of Economic Analysis has updated its regional economic modeling system used by local planners, investors, and policymakers. This tool can help assess the potential economic effects of a new corporate headquarters, a highway project, or new regulations.
Economic impact studies use the Regional Input-Output Modeling System, known as RIMS II, to analyze how projects will ripple throughout county, state, or regional economies. For example, building a new road leads to increased production of asphalt and concrete. That leads to more mining. Workers benefiting from these increases will spend more money, perhaps on eating out or entertainment.
RIMS II is based on BEA’s national supply-use tables, also called the input-output accounts. These detailed tables show the goods and services produced by hundreds of industries and how those goods and services flow to other industries or consumers, for a comprehensive picture of relationships throughout the U.S. economy.
RIMS II uses BEA’s regional data to focus the picture on economic relationships within a specific area. For example, a bakery might buy eggs locally and cake boxes from afar. If a new corporate neighbor starts ordering lots of cakes, the bakery will spend more money in the local economy on eggs, but its increased box spending goes outside the region.
BEA uses a region’s economic relationships to calculate “multipliers,” used to estimate a project’s impact on the region’s total gross output, value added, earnings, and employment.
RIMS II was updated Aug. 29 to reflect BEA’s new 2012 benchmark supply-use tables (the benchmark is typically updated every five years) and 2017 regional economic data. The new multipliers are available for 372 detailed industries and 64 industry aggregates.
The RIMS II model is customized for each customer’s needs. Multipliers may be ordered by region or industry:
- By region: Multipliers are provided for all the industries for the region that is purchased. Each region costs $275.
- By industry: Multipliers are provided for 50 states and the District of Columbia for each industry purchased. Each industry costs $75.