dollars coming into the area. However, the flow of dollars within the 

 area is reduced by $1.43. 



Income Flow within the County 



The change in the inflow of income into the County is essentially the net 

 change in gross farm income. The estimated change in gross farm income 

 for both the high and low resource use estimates for the year 1959 is 

 $23,480. The final impact of this reduction in gross farm income will 

 depend on the demand for local goods and services. If this demand is 30 

 percent of total demand in the area, and all income is spent in the area, 

 then the income flow within the area will be reduced by $1.43 for each 

 dollar lost in gross farm income for a total reduction of $33,600 due to 

 the Soil Bank for the 1959 year. The loss in income to owners of nonfarm 

 resources is estimated to be about $10,000 as the effect of the change in 

 gross farm income spreads with each transaction throughout the economy. 

 If the complete loss in income were to be absorbed by a few individuals 

 ]n the nonfarm economy, the loss of $10,000 would amount to the annual 

 wage of about 3 workers.^ 



For the remaining years covered by Soil Bank contracts, the amount 

 of income loss for the high use resource estimate would remain the same 

 as in 1959. But with the low resource use estimate conditions would differ. 

 In this case, income to providers of local services would be increased by 

 about $6,000 annually, equivalent to the creation of two additional jobs. 

 However, not all money is spent in the area. Many purchases are made 

 from mail order houses, and some income is saved and invested outside 

 the area. Hence, the effect of the Soil Bank on the local economy would 

 appear to be something less than the 3 job equivalents estimated for 1959. 



The same conclusions would hold for the high resource estimate over 

 the lifetime of the current contracts. If some of the change in gross income 

 is not spent in the area, the increase for the low resource use estimate prob- 

 ably would not reach the level of $6,000 per year over the life of the Pro- 

 gram. Further, if the demand for local services was something less than 

 30 percent of total demand, the impact would be less. The effect of the 

 Program on income flow within the area, even when liberally computed, 

 appears to be negligible. 



Expenditure Patterns 



In a previous section, two agricultural resource use models were de- 

 veloped to show the impact of the Program on gross farm income. For the 

 high resource use model, the immediate income loss is estimated to be 

 about $23,000, while the average annual decrease in income from 1960- 

 72, was estimated to be about $22,000 below the level that would ha^^e 

 existed had there been no Program. For the low resource use model, gross 

 income would have declined during 1959 by the same amount as w^ith 

 the high income model. However, for the longer time period, it was esti- 

 mated that the Program would have increased the gross income attribut- 

 able to the enrofled resources by about $14,000 per year. The important 

 conclusion was that the difference in income resulting from the Soil Bank 



"^ However, it would be anticipated that the income effect would be spread out over 

 individuals who provide services in the County. 



29 



