167 



TABLE IV.3.16.— ESTIMATED ECONOMIC ACTIVITY AND PERSONAL INCOME GENERATED BY PRIMARY EXPENDI- 

 TURES ASSOCIATED WITH NARRAGANSETT BAY, RHODE ISLAND 1967-681 



Economic Activity Generated ' 



Primary Personal 



Activity expenditures 3 Multiplier Total Multiplier income 



U.S.Navy... _._. $215,808,384 2.73 $589,156,888 1.22 $263,286,228 



Marine industry -. 60,006,000 2.37 142,214,220 .95 57,005,700 



Transportation 49,563,000 1.00 249,563,000 .64 31,720,320 



Waste disposal 6,200,000 1.69 10,4/8,000 1.29 7,998,000 



Research and education 5,235,294 1.95 10,208,823 .62 3,245,882 



Boating (services).. 3,815,788 2.76 10,531,574 .94 3,586,840 



Summer housing 2,870,875 2.35 6,746,556 .78 2,239,282 



Commercial fishing 2,207,855 2.96 6,535,250 1.18 2,605,268 



Sw(imming___ -... 385,294 2.68 1,032,587 .96 369,882 



Total 346,092,490 826,466,898 372,057,402 



> For multipliers see: Rorholm, Lampe, Marshall, and Ferrell "Economic Impact of Marine Oriented Activities— A 

 Study of the Southern New England Marine Region." Economics of Marine Resources No. 7, University of Rhode Island, 

 Kingston (1967). 



2 The "primary" figure here is based on a multiplier value, hence no additional multiplier effect is present. 



' The "primary expenditure" here is actually an opportunity cost (see the appropriate section). The multiplier that 

 has been used is that computed for "Households" since the saving occurrs in household expenditures. 



Spending generates income and further spending. Multipliers de- 

 veloped in an earlier study have been used to estimate the extent to 

 which the $346 million primary expenditure generates further eco- 

 nomic activity and personal income in the area. It is estimated that 

 primary expenditures generate a total transaction of $826,466,898 of 

 which over $372 million is personal income in the form of wages, sal- 

 aries, profit, interest, and rent. The latter figure may also be thought of 

 as the local value added. The total transactions generated are about 

 23 percent of the gross State product for Rhode Island which was 

 estimated at about $3.5 billion in 1964. The $372 million personal in- 

 come is about 13 percent of total personal income in the State in 1967 

 which was estimated at $2.9 billion. 



Narragansett Bay gives an example of an estuarine-oriented economy 

 which has grown up m an unorganized fashion as economic and social 

 pressures dictated. The major contributing monetary factor is the ex- 

 penditures of the U.S. Navy, which account for nearly two-thirds of 

 the economic activity generated in the Narragansett Bay area. The 

 least significant economic use is commercial fishing, accounting for less 

 than 1 percent of the economic activity. 



An estuary such as Narragansett Bay, through its effect on the physi- 

 cal environment of the surrounding area, bestows a certain value on 

 this area. This is the only "output" of the bay which does not require 

 combinations of labor and capital added to the bay itself. To be sure, 

 it may be possible to increase this output or effect by certain man-made 

 modifications, but since the evaluation of our environment is to a large 

 extent subjective, one cannot always be sure that net results of man- 

 made modifications are, in fact, positive. 



There are two kinds of specific environmental effects involved : 



(1) Climatic effects. Weather data indicate that the bay lowers 

 the mean maximum summer temperature in Providence as much as 

 4 degrees through the way the bay channels the afternoon sea 

 breezes inland from the ocean. Similarly the water gives off its 

 stored heat at a slower rate than does the land resulting in some 

 modification of mean low winter temperatures. This can be ob- 



42-847 O — 70 12 



