Abstract
There has been considerable controversy about the economic impacts of the federal Gulf deepwater oil drilling suspensions following the oil spill. In this study, we elaborate and apply the National Interstate Economic Model (NIEMO) to estimate direct, indirect and induced economic losses in each of the 50 states (and the District of Columbia). We simulate the effects of three separate, 6-month direct loss scenarios of media guestimates reported by several local sources. While the traditional NIEMO application only captured direct and indirect impacts, we developed a new module to estimate local induced impacts as well. This methodology could be applied to any similar scenario. Our model extension and application suggest a useful approach to tasks such as the one assigned to Gulf Coast Claims Facility administrator Kenneth Feinberg. The terror threat, as well as the possibility of other mishaps and natural disasters, suggests that this is always a serious possibility that these sorts of calculations will have to be made. Our innovation was to estimate the Type-II effects in the impacted states and to trace their trade effects through the NIEMO system with only minor methodological elaborations.
5 Appendix
Appendix: I IMPLAN-to-NAICS-to-USC sector conversions using BEA’s state GDP of 2008 for a 6-month period.
i. Oil, Louisiana.
| USC Sector (IMPLAN code) | IMPLAN Sector | NAICS 2002 Code | Direct |
|---|---|---|---|
| USC10 (19) | 19, 142, 145, 146 | 211, 32411, 324191, 324199 | $2.3133B |
Damage: 10% of Oil Extraction Relating Industries of LA GDP.
Source: http://www.economy.com/dismal/article_free.asp?cid=199173&src=msnbc.
ii. Seafood, Louisiana (the closest we can get to shrimps and oysters).
| USC Sector (IMPLAN Code) | IMPLAN Sector | NAICS 2002 Code | Direct |
|---|---|---|---|
| USC1 (16) | 16, 71 | 1141, 3117 | $0.0972B |
Damage: 10% of Fishing Relating Industries of LA GDP.
Source: http://www.economy.com/dismal/article_free.asp?cid=199173&src=msnbc.
iii. Tourism and tourist-related activities, Florida. Refer to the direct impact calculation procedure for tourism and related industries applied in Richardson et al. (2007) and Gordon et al. (2007).
| USC Sector (IMPLAN Code) | IMPLAN Sector | NAICS 2002 Code | Direct | Reference |
|---|---|---|---|---|
| USC33 (391) | 391, 395, 397 | 481, 485, 487 | $1.7622B | Gordon et al. (2007), Richards et al. (2007) |
| USC35 (405) | 405, 408~412 | 445, 448~454 | $8.0930B | |
| USC44 (475) | 475~478 | 712, 71394, 71395, 7131 | $1.8525B | |
| USC45 (479) | 479~481 | 72111, 72112, 72119, 7212, 7213, 722 | $4.5390B | |
| Total | $16.2467B |
Damage: 30% of Tourism Relating Industries of FL GDP.
Source: http://www.americanthinker.com/2011/01/gulf_oil_spill_more_a_mancause.html
http://www.gulfoilspilllitigationgroup.com/blog/tag/gulf-coast-tourism/
Appendix II: Definitions for USC sector system.
| USC Sector | Description |
|---|---|
| 1 | Live animals and live fish and meat, fish, seafood, and their preparations |
| 2 | Cereal grains and other agricultural products except for animal feed |
| 3 | Animal feed and products of animal origin, n.e.c. |
| 4 | Milled grain products and preparations, and bakery products |
| 5 | Other prepared foodstuffs and fats and oils |
| 6 | Alcoholic beverages |
| 7 | Tobacco products |
| 8 | Nonmetallic minerals (Monumental or building stone, natural sands, gravel and crushed stone, n.e.c.) |
| 9 | Metallic ores and concentrates |
| 10 | Coal and petroleum products (Coal and fuel oils, n.e.c.) |
| 11 | Basic chemicals |
| 12 | Pharmaceutical products |
| 13 | Fertilizers |
| 14 | Chemical products and preparations, n.e.c. |
| 15 | Plastics and rubber |
| 16 | Logs and other wood in the rough and Wood products |
| 17 | Pulp, newsprint, paper, and paperboard and paper or paperboard articles |
| 18 | Printed products |
| 19 | Textiles, leather, and articles of textiles or leather |
| 20 | Nonmetallic mineral products |
| 21 | Base metal in primary or semi-finished forms and in finished basic shapes |
| 22 | Articles of base metal |
| 23 | Machinery |
| 24 | Electronic and other electrical equipment and components, and office equipment |
| 25 | Motorized and other vehicles (including parts) |
| 26 | Transportation equipment, n.e.c. |
| 27 | Precision instruments and apparatus |
| 28 | Furniture, mattresses and mattress supports, lamps, lighting fittings, and illuminated signs |
| 29 | Miscellaneous manufactured products, scrap, mixed freight, and commodity unknown |
| 30 | Utility |
| 31 | Construction |
| 32 | Wholesale trade |
| 33 | Transportation |
| 34 | Postal and warehousing |
| 35 | Retail trade |
| 36 | Broadcasting and information services |
| 37 | Finance and insurance |
| 38 | Real estate and rental and leasing |
| 39 | Professional, scientific, and technical services |
| 40 | Management of companies and enterprises |
| 41 | Administrative support and waste management |
| 42 | Education services |
| 43 | Health care and social assistances |
| 44 | Arts, entertainment, and recreation |
| 45 | Accommodation and food services |
| 46 | Public administration |
| 47 | Other services except public administration |
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