Multiplicands data and the distribution of environmental expenditures in the upper Mississippi river basin

Economic multipliers are widely used in regional impact and policy analysis. A substantial literature has developed, defining multipliers and offering guidelines on estimation. This has also been tied to developments in regional growth theory, economic impact analysis, and input output analysis. The importance of regional multiplier analysis is likely to grow as infrastructure programmes are seen as important inputs into economic productivity growth initiatives and as fiscal transfers take on a more prominent role in economic integrations (e.g., the European Union, NAFTA, and the African Union). This paper is concerned with the problems of defining appropriate multiplicands, the initial injections that drive multipliers, at the regional level. Setting aside the literature on the export growth model, this aspect of impact analysis has been relatively neglected. The study presented here, of environmental expenditures in the Upper Mississippi River Basin, looks at some of the problems of using publicly available data to develop and derive a meaningful multiplicand.