VIII The Willamette River Case: 



ANALYSIS OF THE 

 DISTRIBUTION OF GAINS 



In the last chapter, we examined the differences in accounting costs 

 that would result from different methods of undertaking the 

 reimbursable feature of the Willamette River project and estimated 

 the distribution of these costs by income classes and by regions. We 

 shall now look at the other side of the coin — the distribution of 

 the gains — to complete the picture of the income redistributive con- 

 sequences of different ways of financing the project's reimbursable 

 feature. 



The first need is to discover the probable distribution of project 

 output, assuming the three potential developers: federal, nonfederal 

 public, and a private utility. This will involve taking account of 

 the "preference clause," which is a feature of power marketing 

 policy governing the distribution of federally developed hydro- 

 electricity. From this, we can approach an understanding of the 

 "first-round" effects in the distribution of gains under alternative 

 approaches to the undertaking. 



The more complicated, and doubtless the more interesting, prob- 

 lem relates to the second and successive rounds of effects. Here 

 the complexity of the problem, as well as the relative scarcity of 

 relevant quantitative information, restricts the effort to rough 

 approximations only, in contrast with our quantitative analysis in 

 connection with the distribution of costs. It is hoped, however, 

 that important insights may come from this type of analysis in 

 spite of the crudeness of the numerical inferences we draw for 

 illustrative purposes. 



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