Kingscote Airport Business Case Appendices - Kangaroo Island ...

Kangaroo Island Futures Authority Draft Economic Impact of Agriculture and TourismAppendix Table 2.1The structure of input-output multipliers for sector i aImpactsGeneral formulaOutput multipliers ($)Initial 1First-roundΣ i a ijIndustrial-supportΣ i z ij -1-Σ i a ijConsumption-inducedΣ i z * ij-Σ i z ijTotalΣ i z * ijFlow-onΣ i z * ij-1Household Income multipliers ($)Initialh jFirst-roundΣ i a ij h iIndustrial-supportΣ i z ij h i - h j -Σ i a ij h iConsumption-inducedΣ i z * ijh i -Σ i z ij h iTotalΣ i z * ijh iFlow-onΣ i z * ijh i -h jGross regional product multipliers ($)Initialv jFirst-roundΣ i a ij v iIndustrial-supportΣ i z ij v i - v j -Σ i a ij v iConsumption-inducedΣ i z * ijv i -Σ i z ij v iTotalΣ i z * ijv iFlow-onΣ i z * ijv i -v jEmployment multipliers (full time equivalents)Initiale jFirst-roundΣ i a ij e iIndustrial-supportΣ i z ij e i - e j -Σ i a ij e iConsumption-inducedΣ i z * ije i -Σ i z ij e iTotalΣ i z * ije iFlow-onΣ i z * ije i -e jaIn a DECON model, Z * (the ‘closed inverse’ matrix), includes a population and an unemployed row and column(see below for details).Model assumptionsThere are a number of important assumptions in the I-O model that are relevant ininterpreting the analytical results.• Industries in the model have a linear production function, which implies constantreturns to scale and fixed input proportions.• Another model assumption is that firms within a sector are homogeneous, whichimplies they produce a fixed set of products that are not produced by any other sectorand that the input structure of the firms are the same. Thus it is preferable to have asmany sectors as possible specified in the models and the standard models for thisstudy were compiled with 66 sectors (see Appendix 1 for further detail).e c o n s e a r c hPage| 55