Propsensities to consume and multipliers
1 - I'm analyzing the effects of a positive household income change on GDP and employment. I'd like to retrieve the propensities to consume of the 9 built-in household income categories in IMPLAN. Could you let me know how I should do? Thanks. 2- I'm also trying to retrieve the multiplier for the direct, indirect and induced effects on employment. Is this info accessible in IMPLAN?
Hi Sylvia! Thank you for your forum post. To address your 2nd question first; you can view the Employment Multipliers in the IMPLAN Software (Explore > Multipliers > Summary Multipliers > Employment Multipliers). In regards to your 1st question, if I am understanding correctly, it sounds as if you are asking how to do a Household (HH) Income Change. This will model the HH income change and do the math for you using the propensity to consume statistics. IMPLAN does not directly display the propensity to consume data. However, if you need this data (outside of the built-in HH spending change functionality) you could back them out. If you want a more detailed explanation of that process, please let us know and we can provide you with additional details. I have included a Case Study Example of a Household Income Change that I think may be informative: http://implan.com/index.php?option=com_content&view=article&id=434#example-4b If this does not answer your question, please do not hesitate to let us know. Thanks
Hi Sylvia, I apologize for the delay in our response. As stated, IMPLAN does not display Marginal Propensity to Consume (MPC) data. However, each household (HH) income category's current savings rate as a percentage of disposable income can be calculated from the information in the Explore > Social Accounts > IxC Social Accounting Matrix screen. First, calculate each HH column's disposable income by summing that column's payments to the Commodity row (2001), Capital row (14001), sum HH rows (10001-9), Foreign Trade (25001) and Domestic Trade (28001). Next, divide each HH column's payment to the Capital row (14001) to get the current savings rate by HH category. Then, 1 - current savings rate = Average Propensity to Consume (APC). Notes: - IMPLAN assumes APC = MPC for each HH category. That is, IMPLAN assumes that each new dollar is distributed over the spending pattern the same way the average dollar is distributed. - The MPC=APC could be calculated directly, but it's easier to explain in writing if we calculate savings and subtract from one. Another way to look at it would be "Take each HH category's total less payments to Federal and State/Local Government less payments as Disposable Income, then apportion as desired to either savings or consumption. Please let us know if you have any questions~ IMPLAN Staff
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