Economic Impact of Beach Closure

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    IMPLAN Support
    Hi Mason! Thank you for your post! IMPLAN will be able to look at the impact of a loss, as it is a linear model. You would put in a (-) sign before entering your number in 1 of the 4 inputs fields. For your analysis, one of the largest constraints on this type of impact are going to be dependent on: 1. how much of the year the beach is closed (year in this case being defined as the portion of the year that it would normally be opened. 2. A separation of local vs. non-local tourists: Non-local tourists might not visit the region during that time if it is a prominent beach or has an exclusive draw. Local beach goers may still go to the beach, in other words, because IMPLAN is an annual model they may just visit the beach on other days it is opened, and their spending, long-term doesn't change at all. Both parties could substitute their spending- i.e. I can't go to the beach so I'm going to go to the ballgame or hire a boat to go fishing.
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    masonmcc
    Hi and thanks for the reply! I'm glad to hear this is something I should be able to accomplpish. In this particular case it is a beach that has a mixture of local and tourist users. The beach was closed for 3-4 days during peak season and was completely closed off to all tourists. A couple questions: - Can you recommend a methodology for addressing this? My initial thought is to determine the average expenditure per daily visitor and multiply by the average # of daily visitors to determine the total potential lost expenditure. I would then use this figure as the input for a sector in IMPLAN as a negative industry sector change. Does this seem viable? - If the above method would work, can you recommend an appropriate sector? It seems like industry "496 Other amusement and recreation industries" covers "Bathing Beaches" so would this be the recommended sector? There is also NAICS 532292 which seems to be specific to beach rentals. Any advice here would be appreciated. - If the above method is viable and entering a negative change to the appropriate sector in IMPLAN estimates the direct, indirect and induced impacts, would these be accurate estimated impacts of the beach closure or do I then need to adjust the numbers for the seasonal nature of the beach or the # of days closed? Thanks in advance! Mason
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    sstauner
    Hi Mason! Thank you for the clarification. I would recommend eliminating any resident spending because any spending that would have been beach spending those days would likely be spent later in the year (since this was so short term) or would have been spent elsewhere. For that short a period of time it would be hard to quantify any true loss to the economy (stemming past perhaps the beach itself), it's unlikely that something this short term prevented people tourists from coming into the economy of spending in the economy. However, if you feel that you can make a valid argument for that from data exogenous to IMPLAN that there is a true economic loss (i.e. money that normally would have entered the economy, didn't (either because visitors avoided the area or because they shortened the length of their stay) their might be a very small quantifiable impact. However, our recommendation for this would likely best be to describe a short-term reduction in sales and talk in terms of Direct Effects only because it seems highly unlikely that there would be stemming effects from this because: 1. It's unlikely that there will be a true reduction in Indirect Effects for such a short term event. a. If products are perishable, the business may lose some inventory to spoilage over this time, but it will likely not decrease additional/ future purchases, if anything replacing them might ever so slightly increase the Indirect Effects. b. being closed for 3-4 days isn't likely going to affect the purchase of non-perishable materials required to operate a business c. key expenditures cannot be affected. This closure won't be prorated into rent, utilities, etc. 2.Short-term losses in sales probably wash out over the course of the year/season even resulting in a net zero Direct Effect in some cases. 3. It's unlikely to have a significant impact on Household spending: a. if possible employees will typically use vacation time for payroll or use this time for recreational activities themselves b. any reduction of payroll over a 3-4 day period is unlikely to have a significant impact on employee spending in the area, especially if the job is seasonal. Thus IMPLAN or any Multiplier Model is probably not the best use for this situation, as overestimation of the impact will likely result even from a conservative scenario.
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    IMPLAN Support
    Hi Mason! Thank you for the clarification. I would recommend eliminating any resident spending because any spending that would have been beach spending those days would likely be spent later in the year (since this was so short term) or would have been spent elsewhere. For that short a period of time it would be hard to quantify any true loss to the economy (stemming past perhaps the beach itself), it's unlikely that something this short term prevented people tourists from coming into the economy of spending in the economy. However, if you feel that you can make a valid argument for that from data exogenous to IMPLAN that there is a true economic loss (i.e. money that normally would have entered the economy, didn't (either because visitors avoided the area or because they shortened the length of their stay) their might be a very small quantifiable impact. However, our recommendation for this would likely best be to describe a short-term reduction in sales and talk in terms of Direct Effects only because it seems highly unlikely that there would be stemming effects from this because: 1. It's unlikely that there will be a true reduction in Indirect Effects for such a short term event. a. If products are perishable, the business may lose some inventory to spoilage over this time, but it will likely not decrease additional/ future purchases, if anything replacing them might ever so slightly increase the Indirect Effects. b. being closed for 3-4 days isn't likely going to affect the purchase of non-perishable materials required to operate a business c. key expenditures cannot be affected. This closure won't be prorated into rent, utilities, etc. 2.Short-term losses in sales probably wash out over the course of the year/season even resulting in a net zero Direct Effect in some cases. 3. It's unlikely to have a significant impact on Household spending: a. if possible employees will typically use vacation time for payroll or use this time for recreational activities themselves b. any reduction of payroll over a 3-4 day period is unlikely to have a significant impact on employee spending in the area, especially if the job is seasonal. Thus IMPLAN or any Multiplier Model is probably not the best use for this situation, as overestimation of the impact will likely result even from a conservative scenario.
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