Interpreting multipliers

Hi, I am trying to tell a story of how a given county economy has evolved in the last 5 years using a few employment multipliers. For example, I am comparing retail industry's multiplier in 2006 Multnomah and 2011 Multnomah County. For 2006, it was 1.39 (Direct + Indirect + Induced)/(Direct), and it increased to 1.74 in 2011. If I simply tell them that multiplier has increased, not many people would be able to understand. Some of my questions are these. In general, what does it mean if the multipliers are higher in 2011 than in 2006 in the same county and in the same industry? Would it mean that county economy is more integrated and less dependent upon the outside – possibly becoming an economy that is more self-sufficient (less dependent on other counties) and vertically integrated? Second, just based on the Multnomah’s retail industry employment multiplier, would it be correct to say that more suppliers of retail industry have relocated from outside of Multnomah County to the inside of the county, or there have been more entrepreneurial activities that are related to retail industry risen within the county from 2006 to 2011? Please let me know if you could share any additional insights as to how I could create a story for people with limited economic background. Thank you. Brian
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  • Hi Brian. After reading your post,we do not have anything of a substantive nature that we could add to your interpretation on the use of multipliers and how to explain them to others. However, we would caution you on drawing conclusions or making statements about how much or how many new suppliers of retail industries that may have located in the county during this time, unless you have some hard numbers to support this statement. Please let us know if this answers your question or if we can be of further help.
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