Income Multipliers 



The fruits and nuts industry has the highest income multiplier. When 

 demand and output increase by one dollar, the region's income should increase 

 by a multiple of 1.397 for fruits and nuts, 1.380 for vegetables and sugar, 

 1.370 for field crops, 1.329 for livestock products, 1.292 for forest and 

 nursery products, and 1.329 for agricultural services. If the output increas- 

 ed by $1,000 in the fruits and nuts industry, then direct and indirect income 

 will rise to $1,397. 



Employment Multipliers 



These multipliers are obtained by dividing the total employment in all 

 sectors of the economy by direct employment per dollar output. Field crops 

 have the largest employment multiplier. When demand for agricultural commod- 

 ities increases by one dollar, the impact on employment is a multiplier of 

 1.749 for field crops, 1.353 for fruits and nuts, 1.308 for livestock pro- 

 ducts, 1.253 for vegetables and sugar, 1.220 for forest and nursery products, 

 and 1.242 for agricultural services. 



Export multipliers 



An increase in employment in basic industry will have a secondary impact 

 on nonbasic industries. This secondary impact is known as the export multi- 

 plier. The rate of growth is determined by its function as an "exporter" out- 

 side the region. Export of products from Southwest Florida channel outside 

 dollars into the region and trigger chain reactions of additional economic 

 activity. The process of each dollar being respent and causing new impacts is 

 not infinite. At each round of spending, some dollars leak out of the economy 

 in the form of savings, taxes, profits to stockholders outside of the region, 

 and as payments for imported goods and services. The total respondent process 

 associated with each additional dollar of sales is called the "multiplier" 

 effect. Multipliers are useful to predict economic expansion due to growth in 

 sectors of the economy. 



According to Loehman and Hsiao (1979), there are various economic indica- 

 tors which can be used to analyze the role of economic sectors in the economy. 

 The various aggregate indicators and multipliers relate to different aspects 

 of economic welfare. A sector with low output multipliers may be important to 

 the economy because of large numbers of people employed. On the other hand, a 

 sector with low employment may have multipliers and hence be important in an 

 expansionary sense. 



Loehman and Hsiao (1979) have further pursued the subject of agricul- 

 ture's impact on the Florida economy. Multiplier analysis often understates a 

 sector's full impact because it measures only changes dealing with final 

 demand. Tables were constructed showing the breakdown of basic agricultural 

 sales to processing and final demand for 1963 and 1970. Fishing and forest 

 products have a low output multiplier (1.239), but this is because over 90% of 

 sales are to processers and very little to final demand. When the related 

 processing sectors are examined, they have high multipliers and large exports. 

 All but three of the food and wood processing sectors rely solely on agricul- 

 ture. In 1970, total employment attributable to agriculture comprised 16.7% 

 of the State's total work force, whereas basic agricultural employment was 

 only 7.7%. Personal income related to agriculture was 21.1% of total income, 



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