Exploring the Unknown - NASA's History Office

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Document III-10
Document title: “Economic Effects of a Space Station: Preliminary Results,” NASA, June
16, 1983, pp. 1–2, 20–21.
Source: NASA Historical Reference Collection, NASA History Office, NASA
Headquarters, Washington, D.C.
This study, sponsored by the NASA Alumni League, reports on only the direct and indirect employment
and income that were generated by NASA spending. It came as NASA was seeking White House
approval to initiate a space station program. Although the impacts are presented by industry and
state, the benefits only represent the multiplier effects of the spending patterns of NASA. These findings
and similar studies were important in convincing legislators how important NASA’s budget had
become to their regions. The following text is the introduction and conclusions from the first draft of
the report.
The Economic Effects of a Space Station:
Preliminary Results
[1] 1.0 INTRODUCTION
SPACE AS AN INVESTMENT IN ECONOMIC GROWTH
This report discusses the economic effects of a manned Space Station. Since the
major reasons for building a Space Station are not economic, this report will also discuss
some of the non-economic benefits to be gained. Some of these benefits include:
• The Space Station will enhance the defense posture of the United States by
demonstrating an ability to control the high ground of space.
• The Space Station will build respect for the industrial strength of the nation by
proving the ability to initiate and maintain large-scale, high technology programs.
• The Space Station program will increase the nation’s pride and confidence just as
the Shuttle and other space programs have done.
Since few of these benefits can be quantitatively assessed, it is not feasible at this time
to justify a Space Station on economic grounds alone.
To look at the Space Station program from an economic perspective, the program is
divided into two major phases: a development phase and an operational phase. During
the development phase, cash flows will consist primarily of government expenditures (to
plan, design, construct, test, and deploy the Space Station hardware) and the resulting
direct and multiplier effects of those expenditures on the economy. During the operational
phase, the direct economic effects will diversify as a variety of government and private
customers begin to use the Space Station.
An important point that needs to be stated is the level at which a Space Station will
influence the economy. During the development phase, the expenditures will be too small
to notice at a macroeconomic level (e.g., about .25% of the Gross National Product).
However, the development expenditures will have significant effects for specific industries
and locations. The operational phase should have a major influence on the overall economy
as [2] the technology spreads throughout all sectors. A Space Station could open the
door to the creation of a whole new industry based on space operations and may provide
the stimulus for new and improved consumer products. The projected revenues for commercial
space activities are highly uncertain due to the length of time (10–20 years) being
addressed. The most likely near-term effect an operational Space Station will have is the
reduced cost of performing certain missions in space.