The Willamette River Case: Gains 257 



Thus, while the ultimate effect of a federally developed hydro- 

 electric site in the Northwest results in some income transfer to the 

 region, a host of additional redistributive consequences among 

 members of society also attends the federal development of hydro- 

 electric projects. ^^ 



Successive Rounds of Gains Under Local Development 



Consider now the distribution of gains on the assumption the 

 project's reimbursable feature is developed as a local undertaking. 

 We shall first seek to identify the locus of gains on the assumption 

 that the co-operator is a local public body — in this instance a 

 municipality. 



GAINS FROM LOCAL PUBLIC DEVELOPMENT 



Our analysis of the differences in accounting costs (Table 38) 

 indicated that annual operating costs for the project's reimbursable 

 feature under local public direction would be about |1.2 million 

 less than if the undertaking were a local private venture. The share 

 of the gains from this difference in annual operating costs would 

 depend, to a certain extent, on the distribution of electrical output 

 of the local public body. Table 47 showed the distribution of the 

 output of municipal systems in the Northwest as 57.3 per cent to 

 final-demand uses and 36.6 per cent to derived-demand uses. This 

 accounts for about 94 per cent of the total sales; the remainder, 

 for miscellaneous uses, was omitted in the tabulation. If only the 

 distribution of output among these two major categories of use is 

 considered, the total gains with whose locus we are concerned 

 amount to about $1.1 million. 



We assume that the distribution of this gain is proportionate to 

 the share of the output that each class of customer purchases. That 



" Of course, these general conclusions are not restricted to federal water 

 resources development policies, but apply to all governmental policies. Different 

 regions and individuals will benefit as a result of other policies in various areas 

 of governmental concern. This multiplicity of policies lends 'veight to the 

 position that the effects of governmental action inspired by efficiency considera- 

 tions will be more or less randomly distributed, and hence lead, over time, to 

 au increase of welfare for almost everyone. 



