-------
*1. Price increase is computed as
Annual Pollution Control Costs
Value of Sales.
Due to lack of demand elasticity information,
this computation does not reflect the projected
increase in prices of metal finished goods. It
is rather, an estimate of the necessary price
increase to recover the costs of pollution
control equipment and operations.
**2. Segmentation into multi-plant corporations and
single plant corporations is due but not limited
to the following reasons:
Multi-plant corporations have greater access
to capital due to their size
The annual pollution control cost for a
plant which is part of a multi-plant firm is
very small relative to the firm's value of
sales
Multi-plant firms' structure indicates an
economic and/or financial advantage in
having a captive metal finishing operation.
***3. All plants with a projected price increase of
more than 25 percent where less than 50 percent
of the products are metal finished. For these
plants it would effectively mean that the cost of
the metal finishing process will increase at
least 50% in comparison with an industry wide
price increase of less than 1%.
****4. This is a measure of the elasticity of demand
facing the firm. The greater the percentage of
parts from outside customers the more elastic the
demand will be.
IV-15
-------
value of sales to obtain the price increase
necessary to cover the added costs of pollution
control for each individual plant. To clarify,
the price increase per plant is computed as,
Price Increase = Annual Pollution Control Costs
Value of Sales
The price increase for the total population of
plants is then computed using a weighting scheme
based on the sales volume of each plant.
The entire population is divided into those
plants with projected price increases lower than
the sample average and those higher than the sam-
ple average. Those plants with projected neces-
sary price increases of less than the average
were considered to experience minor economic
impact and flagged out.
All remaining plants are further distinguished
according to those with a projected price
increase of greater than either the sample aver-
age or five percent, whichever is larger. The
five percent figure was chosen because five per-
cent price increase is considered a major change,
as it is significant enough to alter demand-
supply relationships. It is especially
appropriate in lieu of the assumption of no
capital availability constraints.
All the remaining plants are divided into those
which are multi-plant corporations and those
which are single plant corporations. A multi-
plant corporation is one where the production
process is performed in more than one plant. In
these cases the firm uses one, or any one of its
plants for peforming metal finishing services for
all its products. A single plant corporation is
one that operates only a single plant and metal
finishing is a major part of the production
process. The segmentation of the plants into
multiplant companies and single plant firms was
done for the following reasons:
Multi-plant firms' structure indicates an
economic and/or financial advantage in hav-
ing a captive metal finishing operation.
The annual pollution control cost for a
plant which is part of a multi-plant firm is
very small relative to the firm's value of
sales.
IV-16
-------
Multi-plant corporations have a greater ac-
cess to capital due to their size.
All single plant firms were singled out as candi-
dates for closure if they met one of two condi-
tions: they faced price increases greater than
ten percent; or they faced price increases
greater than five percent and the percentage of
metal finishing performed for outside customers
was greater than 50 percent.
Any firm that obtains more than 50 percent
of its total revenue by performing metal
finishing services for outside customers is
a quasi-job shop and faces a relatively
elastic demand curve; i.e., the firm's
services are relatively price sensitive.
The reason that the demand curve is more
elastic in these cases is that in a compe-
titive industry outside customers can
readily observe prices and by careful
shopping, always choose the lowest price.
A firm with a ten percent increase will not
be able to compete in an industry where the
average price increase is less than one
percent (0.2 percent is the estimated price
increase for the chosen option).
All multi-plant corporations are singled out as
candidates to divest their captive operation if
the projected price increase in the captive plant
is 25 percent or more and the percentage of
products receiving metal finishing is less than
50 percent. As mentioned above, multi-plant
corporations are not as vulnerable to the rising
costs of production and thus would only divest
their metal finishing operation under extreme
conditions. A captive plant that metal finishes
less than 50 percent of its products and has an
overall price increase of more than 25 percent
due to metal finishing pollution control costs
will effectively experience at least a 50 percent
increase in the cost of the metal finishing
process. Thus, it will have a great incentive to
contract out its metal finishing operations or do
away with the process altogether in favor of a
less costly alternative.
In addition, an analysis of secondary impacts on final
consumption goods is carried out with the use of an input-
output analysis. (I/O model is discussed in detail in the
appendix.)
IV-17
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V. REGULATORY OPTIONS AND DERIVATION OF
COMPLIANCE COSTS
Effluent treatment options and their associated costs
are obviously instrumental in the assessment of the eco-
nomic impacts of water pollution controls. This chapter
addresses the following:
Regulatory options
Derivation of compliance costs
Derivation of the size of the affected universe.
1. REGULATORY OPTIONS
The Environmental Protection Agency evaluated two
regulatory options for existing industrial sources. A
third option was also evaluated for new sources. Each
option sets a compliance standard and assigns specific
pollution abatement equipment.
Option I equipment includes:
Chemical Oxidation Unit
Chemical Reduction Converter
Clarifying Units
Sludge Drying Beds.
Option II equipment includes all the equipment
necessary to meet Option I/ with the addition of
a multimedia-filtration unit.
Option III equipment includes all the equipment
necessary to meet Option I plus in-plant controls
on cadmium.
The pollution control equipment requirements are the
same for both job shops and captives.
2. DERIVATION OF COMPLIANCE COSTS
The derivation of water pollution control costs dif-
fers somewhat between job shops and captives.
(1) Job Shop Plant Costing
Information from the 1976-77 Survey of Metal
Finishers on 28 direct discharging job shops was sub-
mitted to the technical contractor for costing. In
V-l
-------
this fashion each plant was run individually through
the technical contractor cost generating program.
Information exists on such key parameters as:
Flow constituents
Plant layout
Materials finished
Hours of operations
Finishing processes
Amperage, thickness of plate
Equipment in place
Tooling, piping
Construction, laboratory costs.
Thus, each plant used as a model for the economic
analysis has a unique set of costs corresponding to
the regulatory options defined by the agency.
(2) Captive Plant Costing
Information on processes of captive plants was
not available from the 1976-77 Survey of Metal Finish-
ers. As a result the determination of the expected
water pollution control expenditures was performed by
taking the following steps:
The technical contractor accumulated manu-
facturing process data on a sample of 100
direct discharging captives and 100 indirect
discharging captives.
Each plant in the sample was costed by the
technical contractor using its costing
program.
The cost data was then grouped and classi-
fied according to a plant's water use and
discharge category.
In the calculation of the baseline and
Option II costs, the 1087 captive plants
from the 1976-77 Survey of Metal Finishers
were grouped by metal finishing water usage
and then individually matched with the
technical contractor's cost estimates.
For the computation of the cost of the metal
finishing flow only, the technical contrac-
tor costed the metal finishing flow and the
electroplating flow of the integrated in-
direct discharging captive plants. The
electroplating flow costs were subtracted
from the total metal finishing flow costs to
obtain the cost of treating the metal
V-2
-------
finishing flow only. These plants were then
matched with plants in the 1976-77 Survey
data base according to water flow
characteristics.
In this fashion all 1087 plants could be
costed and results extrapolated to the 7,500
indirect discharging plants and 2,500 direct
discharging plants.
3. ESTIMATION OF THE SIZE OF THE UNIVERSE
The agency relied on the Permit Compliance System
(PCS) File for the estimation of the captive metal finish-
ing universe. That file was also used to estimate a total
of 300 direct discharging job shops in SIC's 3471 and 3479.
The PCS File showed that there are approximately 2,500
direct discharging captives in SIC's 25-39 that will be
covered by the metal finishing effluent guidelines. Most
of these plants are in SIC's 34-39. The 1976-77 Survey of
Metal Finishers indicated that there were three times as
many indirect dischargers as direct dischargers, and thus,
it was determined that there are 7,500 indirect discharg-
ing captives in the metal finishing universe.
(1) Segment of the Universe Affected By This
Regulation
In order to determine the affected universe the
Agency recently conducted three surveys to update its
information on pollution control equipment in place.*
The findings of these surveys are as follows:
None of the 300 direct discharging job shops
will have to invest in order to comply with
Option I standards.
None of the 2,500 direct discharging cap-
tives will have to invest in order to meet
Option I standards.
The results of the first survey are outlined in a July
30, 1981 memorandum from Mr. Richard Kinch to Mr. Art
Herman. The second survey's sample design and selec-
tion procedure is described in an August 20, 1981
memorandum from Mr. Richard Kotz to Mr. David Pepson.
The results of the survey are contained in a memoran-
dum from Mr. Henry D. Kahn to Mr. David Pepson. The
results of the last survey are described in a mem-
orandum dated December 3, 1981 from Mr. Kinch to
Mr. Berman.
V-3
-------
Of the 7500 indirect discharging captives,
the Electroplating Pretreatment regulation
covers all process flows at the non-
integrated plants (3750 plants). The elec-
troplating standards also regulate the elec-
troplating processes of integrated plants
which also number 3750 plants. Of the inte-
grated plants:
17 percent will not need to install
treatment because they meet EPA
limitations through the use of
in-process controls
51 percent have already installed
Option 1 level pollution treatment
equipment for all relevant processes.
This leaves 1200 integrated plants that EPA estimates
will bear additional costs to meet Option I standards.
To summarize, the surveys conducted by the
Environmental Protection Agency found that all direct
dischargers, job shops and captives have already met
Option I compliance standards, and 1200 indirect
discharging captives require an addition to their
existing equipment to meet Option I levels. Nearly
all plants in the metal finishing universe will have
to make additional investments to meet Option II com-
pliance standards.
V-4
-------
VI. ECONOMIC IMPACTS
The estimated economic impacts of the regulations are
significantly different for Option I compliance levels and
Option II compliance levels. Compliance with Option I
standards will have very small effects on the metal
finishing universe, while compliance with Option II will
have measurable impacts.
1. BASELINE CONDITIONS
The indirect discharging segment of the metal finish-
ing industry is also covered by the Electroplating Pre-
treatment regulation promulgated by EPA in 1979. Com-
pliance with the Electroplating standards requires a con-
siderable investment cost. Because the process coverage
of the Metal Finishing regulation is more comprehensive,
it will require an additional capital investment for
approximately 16 percent of all indirect discharging
plants. A vast majority of the metal finishing plants
will not need an additional investment in treatment
technology because they either:
Have only electroplating process flows (and are
therefore completely covered by the
Electroplating Pretreatment regulation)
Have already installed pollution control
equipment that treats all their metal finishing
processes
Have in-plant "process" controls that treat
process flows sufficiently to meet proposed EPA
Limitations.*
For those plants requiring an additional investment in
pollution control equipment, electroplating compliance
costs are factored into the baseline conditions. The
costs attributable strictly to this Metal Finishing regu-
lation are then added on so that incremental economic
impacts can be measured. The baseline costs for this seg-
ment of the metal finishing population -- derived by
employing assumptions identical to those for deriving the
metal finishing costs and using 1980 as the baseline
year — are $453 million in capital costs and $136 million
*This calculation is partially based on EPA surveys of the
metal finishing industry.
VI-1
-------
in annual costs. As a result of these compliance expendi-
tures EPA estimates that there will be 24 baseline plant
closures and 6 electroplating process line divestitures.
The incremental costs and impacts for the Metal Finishing
regulation are described below.
2. CAPITAL AVAILABILITY CONSIDERATIONS
The job shop methodology explicitly takes into consi-
deration the ability of plants to finance new invest-
ments. In fact, the closure model is based on financial
variables, the magnitude of some are determined by the
market.
No systematic analysis of the ability of captive
plants to finance investment was conducted because the
majority of the captive plants that require investment in
pollution control equipment are large (more than $50 mil-
lion in annual sales). Moreover, the magnitude of the
average required annual investment is small relative to
the size of the plants. In addition, no finance informa-
tion was available for captive plants.
3. ESTIMATED IMPACTS OF OPTION I
As Exhibit VI-1 on the following page shows the total
compliance burden of Option I is $271 million in invest-
ment costs and $81 million in annual costs. Annualized
costs include an annualized portion of investment costs
plus yearly operation and maintenance costs.
These investment and annual costs apply to an esti-
mated 1200 of the 3750 integrated indirect discharging
captive shops. They arise from treating the
non-electroplating portion of the effluent from integrated
plants. The electroplating effluent portion was regulated
already by the 1979 Electroplating Pretreatment Standard.
Exhibit VI-2 shows that no plant closures, divestiture or
employment losses are expected due to compliance with
Option I. The estimated price increase is approximately
0.2 percent.
Other sectors covered by the metal finishing
regulation — the balance of the integrated indirect
discharging captives, the direct discharging job and
captive shops, and the non-integrated indirect discharging
captives are not expected to incur additional costs from
the regulation. A series of 1981 agency surveys indicated
that approximately 2550 of the integrated indirect dis-
charging captives and all direct discharging job and
captive shops already have treatment in place sufficient
VI-2
-------
EXHIBIT VI-1
TOTAL CAPITAL INVESTMENT AND ANNUAL
COSTS BY OPTIONS
(In Millons of 1980 $)
OPTION I
Investment Costs
Annual Cost
OPTION II
Investment Costs
Annual Cost
JOB SHOPS
0
0
13.2
4.0
CAPTIVES D.D
0
0
380.0
114.0
CAPTIVES I.D
271.0
81.0
601.0
180.0
TOTAL
271.0
81.0
994.2
298.0
VI-3
-------
to meet option I standards or do not need treatment. The
3750 non-integrated indirect discharging captives are also
not expected to incur costs from the metal finishing regu-
lation. These shops are already covered by the Electro-
plating Treatment Standards. Although the limitations in
the metal finishing regulation are more stringent, they
can be met with the same technology basis as that employed
to meet the electroplating standards, and, thus, are not
expected to give rise to additional costs.
4. ESTIMATED IMPACTS OF OPTION II
Exhibits VI-1 and VI-2 summarize the estimated impacts
of compliance with Option II. The total investment cost
for the job shop sector is estimated at $13.2 million,
while investment for captives will be slightly less than a
billion dollars. Total job shop closures are estimated at
42 (14 percent of job shop universe) while captives are
expected to shut down 29 establishments (less than one
percent of captive universe) and divest of 10 more. A
total of 2,067 jobs will be lost due to Option II com-
pliance requirements, with 1,122 accounted for by job
shops. The price increase in the job shop sector is cal-
culated to be 4 percent, while in the captive sector it
will be 0.5 percent.
5. ESTIMATED IMPACTS OF OPTION III
Option III compliance costs were estimated for New
Source Performance Standards/Pretreatment Standards for
New Sources. These standards will apply only to those
metal finishing plants that will need in-plant cadmium
controls. The incremental annual cost of the cadmium
controls will be between $17,800 and $24,000 (in 1980
dollars) per plant. These costs are not expected to have
adverse competitive impacts. Chapter IX contains a more
detailed discussion of Option III costs and impacts.
6. ESTIMATED SECONDARY PRICE IMPACTS
The secondary price impacts were derived with the use
of an input-output analysis. The analysis estimates the
inflationary impact of a change in the price of metal
finishing services. The input-output analysis provides a
method of examining in a simple but quantifiable way the
relationship between prices in a particular economic
system. It makes possible an estimate of the consequences
of a change in any one price upon the others in the
system. (Appendix A provides a detailed exposition of the
input-output model). The input-output analysis assumes
that all increases in costs, direct or indirect, are
passed on: i.e., that each sector raises the price of its
primary inputs, plus the rise in the price of the inputs
VI-4
-------
absorbed from other industries. However, it is important
to note that the input-output model employed assumes that
the whole economy could be adequately represented by
static input-output technical coefficients. Therefore/
estimation results based on the I/O model should be read
with this inherent weakness in mind.
Exhibits Vl-3 and VI-4 on the next page show the se-
condary price impact on the following:
SIC's 34-39
Personal consumption expenditures
Gross private fixed capital formative
Net exports
Total federal government purchases.
VI-5
-------
EXHIBIT VI-2
ESTIMATED IMPACTS OF REGULATORY COMPLIANCE
OPTION I
JOB SHOPS CAPTIVE D.D CAPTIVE I.D.
Plant Closures 000
MF Divestiture 000
Employment Loss 000
Price Increase 0 0 0.2%
OPTION II
Plant Closures
Plant Closures (%)
MF Divestiture
Employment Loss
Employment Loss (%;
Price Increase
TOTAL
0
0
0
0.08%
OB SHOPS
42
14
0
1122
15.6
4.0%
CAPTIVE D.D
21
0.8
10
760
0.04
0.5%
CAPTIVE I.D.
8
0.1
0
185
0.05
0.5%
TOTAL
21
0.7
10
2067
0.04
0.5%
VI-6
-------
EXHIBIT VI-3
ESTIMATED PRICE INCREASES FOR
2-DIGIT SIC'S (IN PERCENT)
SIC OPTION I OPTION II
34 0.3 0.9
35 0.3 0.9
36 0.1 0.3
37 0.1 0.2
38 0.1 0.2
39 0.1 0.3
EXHIBIT VI-4
ESTIMATED TOTAL PRICE IMPACT OF EPA BATEA
METAL FINISHING REGULATIONS ON PRINCIPAL
FINAL DEMAND COMPONENTS
FINAL DEMAND SECTORS PERCENTAGE PRICE INCREASE
Option I Option II
Personal Consumption Expenditures 0.01 0.02
Gross Private Fixed Capital Formation 0.005 0.01
Net Exports 0.01 0.02
Total Federal Government Purchases 0.007 0.01
VI-7
-------
VII. REGULATORY FLEXIBILITY ANALYSIS
The Regulatory Flexibility Act (Public Law 96-354) is
a regulatory reform initiative designed to ensure that,
while achieving statutory goals, regulations do not impose
unnecessary costs on "small entities." Small entities are
defined in Section 2(a)(3) as "small businesses, small or-
ganizations, and small governmental jurisdictions with
limited resources." The analytical requirements for regu-
latory flexibility analysis are enumerated in Sections 603
and 604 of this statute. Section 605 (b) qualifies these
requirements and states that:
"Sections 603 and 604 of this title shall
not apply to any proposed or final rule if
the head of the agency certifies that the
rule will not, if promulgated, have a sig-
nificant economic impact on a substantial
number of small entities."
Option I, the selected option, will affect only inte-
grated captive shops. These tend to be extremely large
operations. The economic impact analysis set forth in this
document indicates that for Option I there will be no eco-
nomic impacts in terms of plant closures for any metal
finishing establishments, including those affected that
are considered to be small entities. Thus, there will not
be "a significant economic impact on a substantial number of
small entities." Exhibits VII-1 and VII-2 display the
industry-wide costs and impacts attributable to compliance
with Option I standards.
Despite the fact that there is, thus, no statutory re-
quirement to perform this analysis, a preliminary investiga-
tion into regulatory flexibility issues has been undertaken.
These issues include:
Definition of a small firm
Establishment of an "optimal" small firm cri-
terion
Regulatory impacts on small firms.
VII-1
-------
EXHIBIT VII-1
Total Captive Investment and Annual Costs
(In Million $)
Option I
Investment Costs
Annual Costs
Job Shops
0
0
Captives D.D.
0
0
Captives I.D.
271.0
81.0
Total
271.0
81.0
EXHIBIT VII-2
Estimated Impacts of Regulatory Compliance
OPTION I
Plant Closures
MF Divestiture
Employment Loss
Price Increase
Job Shops
0
0
0
0
Captive D.D.
0
0
0
0
Captive I.D.
0
0
0
0.2%
Total
0
0
0
0.2%
VII-2
-------
1. DEFINITION OF A SMALL FIRM
In considering reasonable definitions of small firms
in the metal finishing industry, four separate approaches
appeared promising. The four methods considered the follow-
ing criteria:
Number of employees, using either total employ-
ment or metal finishing production employees
Sales volume or value added by manufacturing
Pollution generation volume either in terms of
metric tons of contaminant or types of contami-
nants in the wastestream
Production/process water volume in gallons per
day.
Several problems are apparent with each index, although
a basis for selecting one, the last criterion, is readily
defensible. Briefly, the operant difficulties in relying on
these measures include:
Number of employees in the firm does not show a
large positive correlation with sales of the firm.
Businesses with relatively few employees can gen-
erate sales volumes greater than that of a plant
with ten times the employment. The problem here
is plant technology and automation levels. In
metal finishing a highly automated plant could be
a production giant, yet appear, on the basis of
employment, to be a small business.
Dollar volume in sales or value added is equally
unsatisfactory due to the fact that by itself it
fails to reflect market vulnerability. As SBA has
long maintained, a small business is small only in
relation to its competitors. Small in this sense
means lacking the stature to influence price or
production trends in the industry. There is no
obvious basis for establishing any sales level as
a distinguishing cut-off for a small firm in this
industry because of the heterogeneity of the pro-
ducers.
VII-3
-------
For regulatory purposes establishing pollution
generating volume is a highly relevant factor for
defining plant size. Regardless of employment or
sales, plants generating large hazardous waste
volumes are of more importance than those generating
trivial quantities. The problem here is that waste
volume is a function of many plant-specific con-
siderations (processes, chemicals, and operations),
and data on a plant's pollution volume are not
readily available.
Plant water volume correlates moderately well with
both employment and sales. While not a predictor
of economic size, water volume is at least asso-
ciated with plant economics. Additionally, plant
water volume correlates with but does not predict
pollution generation volume. It serves, therefore,
as a reasonable measure of plant size both on eco-
nomic and technological grounds.
Extensive sensitivity analysis that was performed in
the economic impact analysis for the earlier electroplating
pretreatment regulation showed that the most vulnerable
plants had a water flow level of less than 10,000 G.P.D.
EPA, therefore, chose plant water volume as the pri-
mary criterion to use in confirming its earlier conclusions
that there would be no significant economic impact on a
substantial number of small entities. It selected the
10,000 G.P.D. flow level used in the earlier Electroplating
Pretreatment Regulation as the cut-off level for identifying
potential small business economic impacts. Exhibit VII-3
on the following page shows a profile of the metal finish-
ing revenues for a 10,000 G.P.D flow level.
2. REGULATORY IMPACTS ON SMALL FIRMS
As stated earlier, only integrated captive shops will
incur incremental investment costs to comply with the metal
finishing BAT/PSES effluent guidelines. The EPA data base
indicates that plants in this subcategory are much larger
than other metal finishing plants. Integrated captives
typically have multi-million dollar sales levels and a
metal finishing process water flow of several hundred
thousand gallons per day. It is likely, therefore, that
very few small establishments, as defined in this chapter,
will be affected by these effluent guidelines.
VII-4
-------
EXHIBIT VII-3
Profile of Captive Metal Finishers
by 10,000 G.P.D. Flow Volume
< 10,000 G.P.D. >10,000 G.P.D.
Population Size 3400 6600
Average Plant Employment 420 1,205
Average Plant Sales (Millions) 7.5 48.1
Average MF Value (Millions) .53 1.83
Average MF G.P.D. 5,190 355,000
* 53.6% of all the firms in the 1976-77 survey reported
sales of greater than $50 million in 1976 dollars.
VII-5
-------
In any case, this report clearly documents that small
firms are expected to experience no economic impacts due to
this regulation. In effect, this means that in no instance
will a plant's annual pollution control costs exceed five
percent of its sales. This conclusion is based on an anal-
ysis of the 1,087 plants surveyed. The plant population
covers an extensive range of plant sizes, processes, sales,
metal finishing water flow, levels of pollution treatment
operating, and other pertinent parameters.
VII-6
-------
VIII. A DISCUSSION OF SOCIAL COSTS
The purpose of this chapter is to explore some practi-
cal means by which the social costs of the metal finishing
regulation can be analyzed, and highlight some of the
difficulties in performing such an analysis on the metal
finishing industry. It should be noted, however, that it
is not the intent here to formally conduct a study of so-
cial costs.
Given the complexity of the metal finishing industry
and the lack of good data it would be most appropriate to
use a static, partial equilibrium/method to estimate the
social costs. Under this approach costs are measured by
the total amount individuals would be willing to pay for
goods and services that could be rendered if the resources
to be employed in compliance with the regulation were
instead used in their next highest valued use. This
framework relies on an analysis of supply and demand
relationships in the directly affected markets. The main
difference between this method and the Hicks-Kaldor/
general equilibrium criterion is that the partial equilib-
rium approach focuses attention solely on the direct
effects of the regulation. The general equilibrium
approach considers all effects, whether directly or indi-
rectly related to the regulation.
For illustrative purposes/ the basic social costs of
the metal finishing regulation can be segmented into the
following components.
The most obvious social cost is the cost of
compliance; that is, the present and future real
resource expenditures necessitated by law.
The metal finishing regulation is expected to
lead to higher input and final product prices.
The resulting dead-weight loss of consumers' and
producers' surplus constitutes a real social cost
and if possible should be quantified.
The regulation could give rise to some resource
unemployment, which translates into lost output.
The resulting costs are important and should be
quantified.
VIII-1
-------
Additional resources will be expended on the es-
tablishment and enforcement of the metal finish-
ing regulation. This includes government
expenditures and private sector expenditures.
These costs should also be taken into account.
In reality, however, an accurate assessment of the social
costs of the metal finishing regulation is extremely com-
plex because the estimation of demand and supply elastici-
ties, output changes, and price changes for all 150 indus-
tries performing metal finishing is very costly, if not
impossible. Further, due to the size of the Metal Finish-
ing universe, the estimated small price increase, and the
magnitude of the overall compliance investment, the real
resource cost will account for more than 95 percent of the
total social costs. As a result of the difficulty in the
assessment of the dead-weight loss in consumer surplus and
the relatively small size of monitoring, implementing, and
estimated litigation costs, calculation of the net pre-
sent value of the resources to be used directly in compli-
ance with the regulation constitutes an appropriate esti-
mation of the total social costs.
To calculate the net present value of the resources to
be used directly in complying with the metal finishing
regulation, the discounted (using a real discount rate of
10% as recommended by the Office of Management and Budget)
stream of operating and maintenance costs was added to the
initial investment costs. This present value was then
annualized in perpetuity by multiplying by 10 percent.*
The annual social cost for Option 1 is estimated as
$62 million. Option II annual social costs are estimated
to be $138 million.
A regulation may affect innovation, market structure,
or productivity in a manner which may impose additional
cost but are untraceable in a static, partial equilibrium
analysis. In the case or this metal finishing regulation
the relative importance of these effects is expected to be
minor.
Formula: Annual Social Cost = .1 (Investment Cost) +
(Annual Operating and
Maintenance Cost)
VIII-2
-------
IX. NEW SOURCE PERFORMANCE STANDARDS/
PRETREATMENT STANDARDS FOR NEW SOURCES
The Federal Water Pollution Control Act of 1972 (the "Act")
requires that New Source Performance Standards (NSPS) represent
the best available demonstrated control technology, processes,
and operating methods. Where practicable, no pollutant dis-
charge at all is supposed to be allowed. Where pollutant dis-
charge is unavoidable, these standards are to represent the
greatest degree of effluent reduction achievable. NSPS applies
only to direct dischargers.
Pretreatment Standards for New Sources (PSNS) will regulate
indirect dischargers. The Act states that pretreatment standards
shall prevent the discharge to a publicly-owned treatment works
(POTW) of any pollutant that may interfere with, pass through,
or otherwise be incompatible with the POTW. The amendments to
the Act further stipulate that industrial discharges must not
interfere with use and disposal of municipal sludges.
Both NSPS and PSNS apply specifically to new sources. New
sources are defined as any building, structure, facility, or in-
stallation that discharges pollutants and for which construction
is started after proposal of the relevant standards. Captive
shops and job shops may be regulated under either NSPS or PSNS.
One option was selected for all new source standards. The
NSPS/PSNS treatment system consists of the Option 1 end-of-pipe
treatment system (described earlier in this report) plus in-
plant controls for cadmium. In-plant controls could include
evaporative recovery, ion exchange, and recovery rinses. The
purpose of these in-plant controls is to reduce cadmium concen-
tration levels in the raw waste stream.
Due to the nature of this option, only new sources that
perform cadmium plating operations will incur additional com-
pliance requirements beyond the proposed BPT/BAT/PSES stan-
dards. EPA estimates that between 13 and 16 percent of exist-
ing sources plate with cadmium. This information is presented
in Exhibit IX-1. It is likely, therefore, that the NSPS/PSNS
requirements will concern only a small segment of the metal
finishing population.
IX-1
-------
EXHIBIT IX-1
Prevalence of Cadmium Platers
Amongst Metal Finishers*
Metal Finishing Subcategory
Captives Job Shops
Percent Cadmium Platers 13.0 16.7
*Source: March 5, 1981 memo from Mr. Jack Nash to Mr. Richard Kinch.
Information collected on the existing cadmium users indi-
cates that they are generally larger and more diverse than non-
cadmium users**, specifically:
Job shop cadmium platers are generally much larger
than job shops that do not plate with cadmium.
Job shop cadmium platers use twice as many types
of metals as non-cadmium platers
Indirect discharging captive cadmium platers con-
sume twice as much water as either their direct
discharging counterparts or the non-cadmium users.
Direct discharging cadmium platers use less water
than all other types of captives, but they generally
employ more people and work with more metals.
The incremental cost to new sources of controlling cad-
mium was used as the basis for measuring these standards'
competitive effects. Annual control costs were calculated
for five different water flow categories. The average cost
results are presented in Exhibit IX-2. The data indicates
that a plant's annual costs of cadmium control will vary be-
tween $17,800 and $24,100.*** These costs are insensitive to
a plant's water flow volume; i.e., unlike the existing source
standards, there is not a strong functional relationship be-
tween a plant's water flow and compliance costs.
This information is based on two memos. The first is dated
March 5, 1981 and is from Mr. Jack Nash to Mr. Richard Kinch.
The second is dated May 1, 1981 and is from Mr. Lior Samuelson
to Mr. Art Herman.
Annual costs are derived from investment cost data in the
Technical Development Document. They are annualized according
to information contained in the 1976-77 Survey of Metal Finishers.
IX-2
-------
EXHIBIT IX-2
Incremental NSPS/PSNS Annual Costs by Metal
Finishing Plant Water Flow Category
(in 1980 $)
Plants With Metal Incremental Annual
Finishing Flow (GPP) Costs of Option 3
<1,000 $ 21,924
1,000-10,000 18,802
10,000-50,000 21,791
50,000-500,000 17,811
>500,000 24,090
Source: Technical Development Document
The cost effects for five plant sales categories due to
NSPS/PSNS requirements were calculated by the following three
step process:
For each plant sales category, model plants were
clustered according to water flow.*
Within each sales category, cost effects were cal-
culated for each water flow cluster by dividing the
incremental Option 3 compliance cost by plant sales.
This approach is similar to the one used to measure
economic impacts of Options 1 and 2 on the captive
metal finishing population.
A weighted average cost effect was calculated for
each plant sales category based on the relative
importance of the water flow clusters.
The results of these calculations are presented in
Exhibits IX-3 to IX-8. The cost effects range from .04 per-
cent for the largest plants to 2 percent for the smallest.
In general, as plants' sales volumes grow larger, the cost
effects become very small. In addition, the cost effects for
nearly 90 percent of the plants (assuming that new sources
have a size distribution equivalent to existing sources) are
.7 percent or less.
Source: 1976-77 Survey of Metal Finishers.
IX-3
-------
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EXHIBIT IX-3
NSPS/PSNS Average Cost Effects
(in 1980 $)
Percent of Average Cost
Sales Existing Plants Effects Due to
Category in Sales Category Option 3 Costs
1mm 11.0% 2.0%
3mm 23.2 0.7
7.5 mm 14.8 0.3
25mm 35.8 0.08
>50mm 15.2 0.04
IX-9
-------
Based on the available data, it does not seem that the
additional costs to comply with the NSPS/PSNS standards will
erect significant entry barriers or create competitive dis-
advantages. The main reasons are the following:
The incremental cost of compliance with Option 3
is small. (Between 0.04 percent and 2.0 percent
of the value of sales).
Only a small percentage of the metal finishing
universe uses cadmium. Assuming that this trend
holds for new source metal finishers, the vast
majority of plants will have no compliance re-
quirements at all due to NSPS/PSNS cadmium controls.
In some processes, cadmium plating may be sub-
stituted for by other metals. This will relieve
these new sources of NSPS/PSNS cadmium controls.
In cases where substitution is not possible due
to the characteristics of cadmium, cost can be
passed through as a result of inelastic demand.
In general, the decision of a firm to enter into the
market for metal finishing will be insensitive to the incre-
mental burden of NSPS/PSNS. For captives, metal finishing
is an input into the production process. As such, they per-
form metal finishing in-house to ensure continuous supply,
to minimize work flow disruptions, and to lower transporta-
tion and packaging costs. If the relative costs of NSPS/
PSNS were high, captives could decide to obtain finishing
services from existing job shops. New job shop sources will
have the same effluent guideline requirements as existing
sources unless the new plants use cadmium. The decision to
use cadmium will be dictated by the demand for cadmium plat-
ing. Elastic demand will mean a high probability of no cad-
mium use while inelastic demand means little or no competitive
impacts.
IX-10
-------
X. LIMITS OF THE ANALYSIS
The purpose of this chapter is to summarize the issues
that bear upon the "power" of the findings presented here-
in. The data and analytic constraints must be understood
in order for the estimates of industry impacts to be held
in perspective. Accordingly, the applicability of the
results rests with how well the data, logic and assump-
tions of the models reflect reality.
The focus of this chapter are the major limitations
involving study issues relating to the:
Quality and quantity of the data
Agency survey updates on equipment in place
Type of models used.
1. QUALITY AND QUANTITY OF THE DATA
A major strategic consideration in the planning of
this study was the appropriate source of information.
Age'ncy budgetary and timing constraints regarding new
financial and economic survey work necessitated the use of
data from prior analyses. This decision may have a
bearing on the findings of this study. The Economic
Impact Analysis relies on data obtained in the 1976-77
Survey of Metal Finishers. The forecasted impacts may be
sensitive to any change in the economic and/or financial
characteristics of the Metal Finishing universe between
1976-77 and 1982.
2. AGENCY SURVEYS ON EQUIPMENT IN PLACE
The Agency conducted two surveys of the Metal
Finishing universe. The purpose of the surveys was to
update information on the proportion of metal finishers
that would require additional pollution control equipment
in order to meet proposed BAT regulations. The survey of
direct dischargers* was conducted on a sample derived from
the NPDES permit records, while the surveys of indirect
The survey's sample design and selection procedure is
described in an August 20, 1981 memorandum from
Mr. Richard Kotz to Mr. David Pepson. The results of
the survey are contained in a memorandum from
Mr. Henry D. Kahn to Mr. David Pepson
X-l
-------
dischargers* relied on the technical contractor's data
base. The projected magnitude of compliance costs and
plant closures is sensitive to any changes in the results
of the surveys due to sampling or data base biases.
3. TYPE OF MODELS USED
Two distinct models were used to analyze the economic
impacts. In general, the design of the models was
constrained by data availability. The job shop model is
essentially a capital budgeting closure analysis that
assumes full cost pass through. Different assumptions on
the elasticity of demand, interest rates, and the model
plants' financial condition may yield different results.
The model used to analyze the impacts on the captive
sector assumes various critical price increase limits.
Any plant projected to require a greater price increase is
considered a candidate for closure. A change in the
critical price limits would alter the results of the
analysis. In addition, the captive analysis assumes a
full cost pass through. A precise prediction of price and
output changes due to the regulation is not possible due
to the complexity of the Metal Finishing universe. The
approach taken here therefore, limits somewhat the
accuracy of the forecasts.
Results of these surveys are described in a July 30,
1981 memorandum and a December 3, 1981 memorandum from
Mr. Richard Kinch to Mr. Art Herman.
X-2
-------
APPENDIX A
INPUT-OUTPUT ANALYSIS
This appendix first sets out a framework within which
the interrelationships between consumption, production and
metal finishing requirements can be measured. Then a
method of quantifying the price relationships of the sec-
tors in an economy/ the input-output price model/ is dis-
cussed.
All economic activities can De divided into two compo-
nents, final demand and intermediate production. Final
demand includes the personal consumption expenditures of
consumers, the expenditures of business for capital goods
replacement and/or augmentation, the expenditures of
government at all levels, and the net exports. Interme-
diate production represents the inter-industry transac-
tions necessary to produce the final goods and services.
The inter-industry model, termed "input-output analysis",
developed by Wassily Leontief [1] and recently estimated
for the year 1972 ay the Department of Commerce, provides
the required framework [2] for estimating and analyzing
tne above mentioned interrelationships.
The basic input-output structure is developed by
dividing the productive and final demand activities of an
economy into a number of sectors, which are arrayed in
matrix form. The distribution of the sales and purchases
of each industry is then estimated for each sector during
a 1-year period. As an example, Table A-l, panel (a),
shows all economic activities divided into three producing
sectors and one component of final demand. Reading across
the rows, one finds the sales (in dollars) of the output
of the sector named at the beginning of the row to the
sector named at the head of each column. Or, reading down
the column, one finds the purchases by each sector named
at the head of the column from the sector named at the
beginning of the row. Final demand can be furcher disag-
gregated into the components used in the national income
accounts. Thus, the total final demand for the output of
an industry is the sum of those components:
Y = C + I + G + I, (1)
A-l
-------
Table A-l. Example ot Input-Output Tables
Ja) Transactions table, X matrix (Dollars)
Producing
sectors
Agriculture
Manufacturing
Services
Tot a L int-f»r-
Total inter Total
Consuming sectors mediate final
agriculture
40
40
0
manufacturers
80
40
60
services
0
20
20
output
120
100
80
demand
80
300
120
Gross
Output K
200
400
200
mediate inputs
80
180
40
Value added
Gross inputs
(b)
Producing
sectors
Agriculture
Manufacturing
Services
Value added
Total
120 220
200 400
Direct requirements
agriculture
0.20
0.20
0
0.60
1.00
(c) Total requirements (direct and
Producing
sectors
agriculture
160
200
500
table, A matrix (Dollars/Dollars)
Consuming sectors
manufacturers
0.20
0.10
0.15
0.55
1.00
indirect) table, S matrix
Consuming sectors
manufacturers
services
0
0.10
0.10
0.60
1.00
(Dollars/ Dollars)
services
Agriculture
Manufacturing
Services
1.33
0.30
0.05
0.30
1.20
0.20
0.03
0.13
1.13
A-2
-------
where*
Y = [yjj final demand for the output of industry
i/ where i = 1....n/
C = [cjj personal consumption expenditure compo-
nent of final demand for industry i
output,
I = [ijj private investment expenditure compo-
nent of final demand for industry i
output,
G = [gjj government expenditure component of
final demand for industry i output, and
T = [tjj net export component (exports minus
imports) of final demand for industry i
output.
The gross output of an industry is the sum of its
sales to other industries and to final demand:
Z = XL + Y, (2)
where
Z = [zj_] gross output of industry i,
X = l*ij] sales of industry i to industry j,
where j = l....n, and
L = n dimensional unit vector.
Analogously, the gross input of industry is the sum of
its purchases from other industries and of value added:
Z = X'L + V, (3)
where
V = [vj_] value added by industry i, and
X*- = [Xji] purchases of industry from other indus-
tries.
* Square-oracketed, lower-or upper-case subscripted
variables denote vectors or matrices.
A-3
-------
Gross national product is measured as the sum of final
demand (expenditure approach) or the sum of value added
(income approach).
Up to tnis point, the input-output table is essenti-
ally a system of accounting identities. However, in situ-
ations where producers are regarded as having only a
limited choice regarding factor (i.e., input) intensities
and wnere adjustments to shifts in demand take the form of
quantity (i.e., output) rather than price adjustments, the
transactions table can be utilized to develop a general
set of production coefficients. Specifically, a set of
technical coefficients can be derived from the transac-
tions table. A technical coefficient is defined as the
dollar input purchases from industry i per dollar output
from industry j, or
A = Uij], (4)
where
Thus, continuing with our example in Table A-l, panel
(b), the values in each column represent the composition
of input to the industry named at the head of the column.
To produce $1.00 of output, the manufacturing sector re-
quires $0.20 of inputs from agriculture, $0.10 from manu-
facturing, $0.15 from services, and $0.5$ of valued added.
Substituting the value of x-j_j from equation (4) into
equation (2) yields the result
Z= AZ + Y. (5)
This is equivalent to
(I-A)Z = Y, (6)
where
I = the identity matrix.
From aquation (6) one can find the "total requirements
matrix," S
Z = SY, (7)
where
3 = tsij] = [I-A]-1.
A-4
-------
Each s-j_j represents the dollar output of industry is
required both directly and indirectly per dollar of final
demand from industry j.
In Taole A-l, panel (c), the s-j_j elements of the
hypothetical economy are shown. Reading down the column,
eacn entry represents the output of the industry named at
the beginning of the row per dollar of final demand from
the industry named at the head of the column. Thus, to
deliver $1.00 of manufactures to final demand requires
$0.30 of output by the agriculture sector, $1.20 by
manufacturing (the $1.00 for final demand plus the addi-
tional manufacturing output required to produce the
required output of all three sectors), and $0.20 of the
output of the services sector.
The three basic input-output tables thus provide the
framework for analyzing the interrelations in an economy.
To summarize:
1. The transactions table, X matrix, shows the flows
between sectors per unit of time;
2. The direct coefficients table, A matrix, indi-
cates the direct output requirements of each sec-
tor to produce one dollar's worth of output by
every other sector; and
3. The total requirements coefficients table, S mat-
rix, indicates the total (direct and indirect)
output of each sector required to deliver one
dollar's worth of output of every other sector to
final demand.
The Bureau of Economic Analysis (SEA), U.S. Department
of Commerce has developed several input-output tables of
the U.S. economy. The latest, a 478-producing-sectors
table based on the structure of production for 1972, has
been employed in this study [2].
A-5
-------
(a)
Table A-2. Example of Diagrregated Personal
Consumption Expenditures Tables
Industrial composition of personal consumption expenditures table, U
matrix (Dollars)
Producing
sectors
Agriculture
Manufacturing
Services
TOTAL (E)
PCE item
1 2
0 80
200 0
80 20
280 Too
Total final
3 demand i
0 80
100 300
20 120
~L2Q ~500
(b) Distribution of the industrial
composition of personal consumption
expenditures table, B matrix
(Dollars/ Dollars)
Producing
sectors 1
Agriculture 0.00
Manufacturing 0.71
Services 0.29
1.00
PCE item
2 3
0.80 0.00
0.00 0.33
0.20 0.17
1.00 1.00
(c) Total requirements personal consumption
expenditures table, K matrix
(Dollars/Dollars)
Producing
sectors 1
Agriculture 0.22
Manufacturing 0.89
Services 0.47
PCE item
2 3
1.07 0.25
0.27 1.02
0.27 0.36
A-6
-------
2. pEASQilAL CONSUMPTION EXPENDITURES INTERRELATIONSHIPS
One drawback of input-output tables in terms of the
objective of this study is their lack of resolution in the
final demand sectors. Specifically, personal consumption
expenditures are usually represented by a single column
vector. Because the purpose of the impact model is to
identify interrelationships between personal consumption
expenditure items and the requirements for materials pro-
duced by the affected sectors, such as metal finishing
requirements, this vector must be disaggregated into a set
of consumer expenditure items. Unpublished BEA data used
in developing the 1972 input-output table were used to
develop a "bridge" between the 478 producing sectors in
the input-output table and 477 personal consumption ex-
penditure items,,
Assuming there are m consumer products, one can define
aggregate expenditures on these products as
E = [em] the total dollar expenditure
on each consumer product at
retail prices. (8)
The Personal Consumption Expenditure (PCE) oridge is
the allocation of the PCE vector among the m consumer
expenditure items:
C = UL, (9)
where
C = [cj_] the personal consumption expenditure
component of final demand for industry
i output,
L = [IjJ m dimensional unit vector, and
u = LuinJ the dollar amount of final demand sales
from sector i required for production
or distribution of consumer product m.
Using the hypothetical economy aoove, suppose all
final demand was for three consumption goods which could
be disaggregated as shown in Table A-2, panel (a).
The bridge can be converted into a set of fixed coef-
ficients in a manner similar to that employed in develop-
ing the direct coefficients:
A-7
-------
B = bi,a = uim, (10)
where
bj_n = dollar of final demand sales from sector i
directly required per dollar expenditure on
consumer product.
The distribution of the industrial composition of each
expenditure item in the hypothetical economy is shown
Table A-2, panel (b).
Last, from equations (7) and (10) we can create a
matrix of the total output of each sector required per
dollar of PCE on each item:
K = S3. (11)
The final matrix, Table A-2, panel (c), shows tne out-
put (in dollars) required by each industry named at the
beginning of the row to produce and deliver one dollar's
worth of the personal consumption expenditure item named
at the head of the column.
In this hypothetical economy, private investment,
government expenditures, and net exports are zero. There-
fore, from equation (1) it is apparent that aggregate PCE
expenditures are assumed to equal aggregate income, i.e.,
C = Y. Therefore, equations (7), (9), and (10) can be
combined to state the further requirement that total pro-
duction in the hypothetical economy equals the sum of the
output requirements of all PCE items; i.e.,
Z = 3Y = SUL = SBE,
or (12)
Z = KE.
A-3
-------
So the effect of a 10 percent price increase in manufac-
turing has been a 2.5 percent increase in agriculture
prices and a 1 percent increase in the price of services.
Using the share of final demand accounted for by each
sector, a cost of living index can be computed. To illus-
trate this idea, recall the total final demand column from
Taole A-2, panel (1), in which the sector components of
personal consumption expenditures were as follows:
agriculture, 80; manufacturing, 300; services, 120. Thus,
total final demand, or personal consumption expenditures,
is 500, so the relative share for each sector is,
respectively,
80, 300 and 120.
500 500 500
The respective prices from the preceding example are p]_
= 1.025, p2 = 1.10 and P3 = 1.01, so a cost-of-living
index, C , can be obtained as follows:
= 1.025
1.10
1.01
120
500
or
c = 1.0664
Thus, the increase in the cost of living as a result of a
10 percent price increase in manufacturing, was 6.6
percent.
A-ll
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4. ESTIMATES OF PRICE IMPACTS OF EPA REGULATIONS
The new level of prices for the 477 PCE items due to
the proposed EPA regulations are determined following the
increases of the price level of the metal finishing uni-
verse (SIC's 34, 35, 36, 37, 38, 39). Exhibit A-3 indi-
cates the estimated price increases for each 2-digit SIC.
The price impact on the major components of total final
demand in the economy is computed based on the price in-
crease in the metal finishing universe.
A-12
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3. THS PRIGS SYSTEM
Input-output analysis offers a method of quantifying
the price relationships of the sectors in an economy.
Since the cost of any sector's output is composed of the
costs of the materials inputs purchased from other sectors
and such items as wages, profits, taxes, and depreciation
which are a part of value added, there are implied price
relationships in an input-output table. By defining unit
price equal to unit cost, the price relationships between
the price of different goods can be expressed as:
PI » anpi + a2iP2 + ... anipn +
P2 = a!2Pl + a22P2 + ••• an2Pn + V2 2
Pn = alnPl + a2nP2 + • • • annPn + vn n
(13)
where
Pi = the price of good i,
aji = the technical coefficients,
Vj_ = tne share of primary inputs, and
i = the price of primary inputs.
By using the equation system (7), the effects of a
price change in one sector upon the relative prices of
every other affected sector's output can be calculated
assuming each industry passes on its increased costs plus
the rise in costs of inputs purchased from other indus-
tries to final demand. For the exposition of the input-
output price model, refer to References 4 and 5.
An example of the procedure for determining price im-
pacts on the value of final demand is shown below for the
three sector economy shown in Table A-l. It is assumed
here that prices of all sectors and all primary inputs in
the base periods are equal to unity for the sake of sim-
plicity. Further, suppose the price level in manufactur-
ing increases 10 percent due to the increased costs neces-
sary to comply with the proposed standard. The problem is
to determine the new level of prices for agriculture and
services.
A-9
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When we assuiae that the prices of primary inputs in
other sectors (i.e. /]_ and $3) are not permitted to
cnan-je, the relationship (13) for the three sector economy
can be easily solved as below by first transposing all the
know elements in each of the three equations to the right
hand side and the unknown variables (and their coeffi-
cients) to the left hand side. Given our assumption, the
"unknowns" are PI, ?3, and $2, and all other elements
are known or assumed known. Thus, equation (13) for a
three sector economy, with our stated assumption, may be
written as:
P2
Pi = allPl + a3lP3 + <
V24>2 = -ai2Pi - a32P3 + d -
P3 = <*13P1 + a33P3 + U23P2
and solved as follows:
PI
P3
a!2
-a13
° ~ a31
2 a32
0 (1 - 33)
-1
a2lP2 + vl*l
(1 - ai2) P2
«
0.8
0.2
0
.55
.15
.90
-1
2(1.1) + .6(1.0)
8(1.2)
,1(1.1) + .8(1.0)
Thus
1.25
- .455
0
0 0
1.313 -.303
0 1.11
X
".82"
.83
.91
55
1.025
.951
1.0.0
PI = 1.025
P3 - 1.011, and
?2 = 1.10 by assumption,
A-10
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EXHIBIT A-3
Estimated Price Increases For
2-Digit SIC's (In Percent)
SIC Option I Option II
34 0.3 0.9
35 0.3 0.9
36 0.1 0.3
37 0.1 0.2
38 0.1 0.2
39 0.1 0.3
A-13
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EXHIBIT A-4
Estimated Total Price Impact or EPA BATEA
Metal Finishing Regulations or Principal
Final Demand Components
Final Demand Sectors Percentage Price Increase
OPT I OPT II
Personal Consumption Expenditures 0.01 0.02
Gross Private Fixed Capital Formation 0.005 0.01
Net Exports 0.01 0.02
Total Federal Government Purchases 0.007 0.01
A-14
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REFERENCES
Leontief, Wassily, Input-Output Economics, Oxford
University Press, New York, 1966.
U.S. Department of Commerce, Office of Business
Economics, 1972 Input-Output Structure of the U.S.
Economy.
United Nations, Problems of Input-Output Tables and
Analysis, New York, 1966.
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1
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