EPA-9O8/4-77-OO9
JUNE 1977
DEVELOPING
ECONOMIC IMPACT
PROJECTION MODEL
FOR THE FORT UNION
COAL REGION
US. ENVIRONMENTAL PROTECTION AGENCY
REGION VIII
DENVER . COLORADO 6O295
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DEVELOPING ECONOMIC IMPACT PROJECTION MODELS
FOR THE FORT UNION COAL REGION
Report No. 77030
By
Thor A. Hertsgaard
Randal C. Coon
F. Larry Leistritz
Norman L. Dalsted
Department of Agricultural Economics
North Dakota State University
June 30, 1977
Project 68-01-3507
Project Officer
Mr. George Collins
Region VIII
Environmental Protection Agency
Denver, Colorado 80203
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DISCLAIMFR
This report has been reviewed by the Environmental Protection
Aqency, and approved for publication. Approval does not sionify
that the contents necessarily reflect the views and policies of
the Environmental Protection Aqency, nor does mention of trade
names or commercial products constitute endorsement or recommen-
dation for use.
This document is available to the public through the National
Technical Information Service, Springfield, Virginia 22151.
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Table of Contents
Page
Introduction 1
Procedures 1
The Model 3
Evaluation of the Model. 5
State of North Dakota 5
Regions in North Dakota 10
Montana 21
Wyoming 21
Conclusions 28
Recommendations for Further Work 34
Appendix A 35
Appendix B 46
List of Tables 51
List of Figures 51
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INTRODUCTION
This report describes the results of work under Phase I of a study
to develop, adapt, and integrate models for evaluating the economic effects
of expanded coal mining and conversion in the Northern Great Plains (Fort
Union) Region. Work under Phase I was designed to determine the usefulness
for describing interindustry relationships in western North Dakota, south-
eastern Montana, and northeastern Wyoming of input-output coefficients
previously developed for North Dakota.
Phase II, if required, would involve modification of the North Dakota
input-output tables to obtain coefficients which more accurately depict
interindustry relationships in the coal impact areas of eastern Montana and
northeastern Wyoming. Such modification likely would involve collection of
expenditures data for those sectors in Montana and Wyoming that are believed
to be significantly different from their counterparts in North Dakota.
Technical input-output coefficients would be computed for those sectors and
those coefficients would be substituted in the computation of a revised
interdependence coefficients matrix.
Phase III will involve the use of the input-output coefficients
evaluated in Phase II (and/or Phase I) to assess the potential effects of
coal resource development in the Fort Union Region.
PROCEDURES
The general procedures involved application of the interdependence
coefficients to the final demand vectors for each state and the relevant
regions within the respective states. Final demand vectors are defined as
production for final demand by the several economic sectors in the regions
that result in a flow of funds into the region from the "rest-of-the-world."
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- 2 -
These receipts consist of sales of livestock and crops, products of mines,
manufactured products, as well as federal government outlays and tourist
expenditures in the region.
Multiplication of the interdependence coefficients and the final
demand vector for the respective state or region yielded estimates of the
gross business volumes for each of the economic sectors in the state or
region. Data were assembled from secondary sources (Appendix A) to provide
estimates of sales for final demand by the respective sectors in each of the
regions and states for the years 1958-1975. Multiplications of the matrix
of interdependence coefficients by the vector of sales for final demand
yielded estimates of total personal income (as well as estimates of gross
business volumes of each of the other sectors) for each of the years for the
respective states and regions. The gross business volume of the household
sector, except for minor definitional differences, is equivalent to personal
income. These estimates were compared to those published by the Bureau of
Economic Analysis, U.S. Department of Commerce, at both the state and regional
level.
Because of the fact that U.S. Department of Commerce estimates of
personal income for substate geographic areas also may be subject to some
degree of error, another independent method was used to disaggregate per-
sonal income in each state to the regional level. This method is described
in Appendix B. The method involved disaggregation of personal income from
the state to the county level in each state for each year and reaggregation
to the regions of interest. These estimates were then compared to those
derived by input-output techniques.
(The reader should note that comparison of regional personal income
estimates based in input-output analysis with those based on disaggregation
procedures involved comparisons for 18 years whereas only 12 years of
estimates were available from the U.S. Department of Commerce.)
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- 3 -
THE MODEL
Stadig was the first to collect primary data for an input-output
model in North Dakota, but initial efforts to gather large quantities of
2 3
data began in 1965. Sand and Bartch collected data in southwestern North
Dakota from a sample of firms, households, and governmental units that were
used to describe the structure of the North Dakota economy and to project
the economic impacts of selected types of development in the state. They
derived technical input-output coefficients and interdependence coefficients
for a 30-sector model of the North Dakota economy.
4 5
Lutovsky and Senechal subsequently explored procedures for testing
the validity of the coefficients derived by Sand and Bartch. They concluded
that the coefficients developed for southwestern North Dakota also were
valid for other parts of the state. However, they recommended that some of
the 30 sectors defined by Sand and Bartch be aggregated into fewer sectors.
Accordingly, data collected by Sand and Bartch subsequently have been aggre-
gated into a set of 13 sectors. Most of the sectors involved were retail
Stadig, L. L., Economic Interrelationships Among Sectors of a Local
Economy with Special Emphasis cm Agriculture: Lisbon, North Dakota, unpub-
lished M.S. thesis, Department of Agricultural Economics, North Dakota State
University, Fargo, 1964.
2
Sand, L. D., Analysis of_ Effects of Income Changes in Intersectoral
and^ Intercommunity Economic Structure, unpublished M.S. thesis, Department
of Agricultural Economics, North Dakota State University, Fargo, 1966.
o
Bartch, B. L., Analysis of Intersectoral and Intercommunity Struc-
Uj£g_ jn Southwestern North Dakota, unpublished M.S. thesis, Department of
A~g~rTcultural Economics, North Dakota State University, Fargo, 1968.
Lutovksy, R. F., Interindustry Analysis of the North Dakota Economy,
unpublished M.S. thesis, Department of Agricultural Economics, North Dakota
State University, Fargo, 1968.
Senechal, D. M., Analysis of Validity of North Djtkojal.npjjt-0ut.pjrt
Models, unpublished M.S. thesis, Department of Agricultural Economics, North
Dakota State University, Fargo, 1971.
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- 4 -
trade sectors, which were aggregated into a single retail trade sector (Sec-
tor 8).
The principal intended use for which input-output coefficients
initially were assembled in North Dakota was for projecting the economic
impacts of irrigation development in the state. However, since the data
were collected, a wide variety of applications has been made. The major use
of the model recently has been for estimating the economic and social impacts
of coal resource development.
The original model developed by Sand and Bartch had only one sector
to describe the various mining activities within the state. This sector
reflected the characteristics of firms in southwestern North Dakota that
were engaged in sand and gravel mining but did not include such activities
as coal and petroleum mining. The omission of coal and petroleum mining was
not a serious deficiency in the model as long as the major component of the
state's economic base was agriculture and as long as there were no important
interdependences of other economic sectors with coal and petroleum mining.
However, the increasing importance of mining as a component of the state's
economic base and the prospects for accelerated development of coal conversion
facilities in the state resulted in a need for more detailed input-output
data for the energy sectors.
Part of the efforts under Phase I of this project involved collection
of expenditures data in North Dakota from firms in four additional sectors
related to energy production. These sectors were coal mining, thermal-elec-
tric power generation, petroleum and natural gas extraction, and petroleum
refining. Technical input-output data were computed for these sectors and
the results were augmented to those previously available for other sectors.
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- 5 -
The augmented matrix of input-output coefficients was the basis for compu-
tation of a set in interdependence coefficients for the 17-sector model of
the North Dakota economy.
The 17 sectors and the Standard Industrial Classification (SIC) Code
numbers corresponding to each are presented in Table 1. The interdependence
coefficients that were computed for the 17-sector model are presented in
Table 2.
EVALUATION OF THE MODEL
The input-output interdependence coefficients developed for North
Dakota were evaluated at the state level for North Dakota, Montana, and
Wyoming and also at the regional level for the coal producing regions of
those states. In each case, final demand vectors were computed for the
state or region, and then were multiplied by the interdependence coeffi-
cients to obtain the level of personal income generated by that level of
export for final demand. These estimates of personal income were compared
with those published by the U.S. Department of Commerce.
State level estimates of sales for final demand by the "basic" sec-
tors were based on secondary data sources. Some difficulty was experienced
in estimating out-of-state sales for some components of final demand and
this tended to be an even greater problem at the regional level. Where good
data existed at the county level, it was the source for aggregations of
county data into regional totals.
State of_ North Dakota
Final demand vectors for the state of North Dakota for the years
1958-1975 are presented in Table 3. Sales of livestock and crops are in
Columns A and B. Exports of coal and petroleum are in Columns H and J.
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- 6 -
TABLE 1.
EACH
ECONOMIC SECTORS OF INPUT-OUTPUT MODEL AND SIC CODE NUMBERS OF
Economic Sector
SIC Code1
1. Ag., Livestock
2. Ag., Crops
3. Sand and Gravel Mining
4. Contract Construction
5. Transportation
6. Communication and Utili-
ties
7. Wholesale Trade and Ag.
Processing
8. Retail Trade
9. Finance, Insurance, and
Real Estate
10. Business and Personal
Services
11. Professional and Social
Services
12. Households
13. Government
14. Coal Mining
15. Thermal-Electric Power
Generation
16. Petroleum and Natural
Gas Extraction
17. Petroleum Refining
Group 013, - Livestock
All of Major Group 01 - Agricultural Produc-
tion, Except Group 013 - Livestock
Major Group 14 - Mining and Quarrying of Non-
metallic Metals, Except Fuels
Division C - Contract Construction (Major
Groups 15, 16, and 17)
All Division E - Transportation, Communica-
tions, Electric, Gas, and Sanitary Ser-
vices, Except Major Groups 48 and 49.
Major Group 48 - Communication and Major
Group 49 - Electric, Gas, and Sanitary
Services (Except Industry No. 4911)
Major Group 50 - Wholesale Trade and Major
Group 20 - Food and Kindred Products
Manufacturing
All of Division F - Wholesale and Retail
Trade, Except Major Group 50 - Wholesale
Trade
Division G - Finance, Insurance, and Real
Estate
All Division H - Services, Except Major
Groups 80, 81, 82, 86, and 89
Major Group 80 - Medical and Other Health
Services, Major Group 81 - Legal Services,
Major Group 82 - Educational Services,
Major Group 86 - Nonprofit Membership
Organizations, Major Group 89 - Miscel-
laneous Services
Not Applicable
Division I - Government
Major Group 12 - Bituminous Coal and Lignite
Mining
Industry Number 4911 - Electric Companies
and Systems
Major Group 13 - Crude Petroleum and Natural
Gas
Major Group-29-- Petroleum Refining and
Related Industries
Executive Office of the President/Bureau of the Budget, Standard Industrial
Classification Manual, 1967, U.S. Government Printing Office, Washington,
u * L »9 i
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TABLE 2. INTERDEPENDENCE COEFFICIENTS FOR BASIC ECONOMIC SECTORS, NORTH DAKOTA
(1)
Agriculture,
Sector Livestock
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
Gross
Ag, Livestock
Ag, Crops
Sand & Gravel Mining
Contract Construction
Transportation
Comm. & Utilities
Wholesale Trade & Ag Proc.
Retail Trade
Fin., Ins., & Real Estate
Bus. & Pers. Service
Prof. & Soc. Service
Households
Government
Coal Mining
Elec. Gen.
Petro./N. Gas Extraction
Petro. Refining
Receipts Multiplier
1.21
0.39
0.01
0.07
0.02
0.09
0.57
0.71
0.15
0.06
0.07
1.05
0.10
a
a
a
a
4.49
(2)
Agriculture,
Crops
0.08
1.09
0.01
0.08
0.01
0.08
0.16
0.81
0.17
0.07
0.06
0.96
0.10
a
a
a
a
3.69
(4)
Contract
Con-
struction
0.03
0.01
0.03
1.05
0.01
0.06
0.02
0.41
0.08
0.03
0.04
0.61
0.05
a
a
a
a
2.44
(7) (8)
Wholesale
Trade & Ag Retail
Processing Trade
0.19
0.65
0.01
0.06
0.01
0.08
1.74
0.61
0.13
0.05
0.05
0.79
0.08
a
a
a
a
4.45
0.09
0.03
a
0.03
0.01
0.05
0.05
1.27
0.06
0.02
0.03
0.40
0.04
a
a
a
a
2.09
00)
Business
&
Personal
Service
0.04
0.02
a
0.05
0.01
0.11
0.02
0.45
0.11
1.05
0.05
0.72
0.08
a
a
a
a
2.71
(12)
House-
holds
0.07
0.03
0.01
0.09
0.01
0.11
0.04
0.74
0.17
0.06
0.10
1.55
0.11
a
a
a
a
3.08
(14)
Coal
Mining
0.04
0.03
a
0.05
0.01
0.07
0.06
0.40
0.08
0.03
0.05
0.67
0.05
1.00
a
0.01
0.02
2.57
(15)
Electric
Generating
0.03
0.03
a
0.03
a
0.04
0.08
0.23
0.10
0.02
0.03
0.40
0.04
0.16
1.00
0.01
0.01
2.21
(16)
Petroleum/
Natural
Gas
Extraction
0.02
0.01
a
0.11
0.02
0.05
0.01
0.18
0.04
0.01
0.02
0.32
0.03
a
a
1.10
a
1.92
(17)
Petroleum
Refining
0.01
0.01
a
0.09
0.02
0.04
0.01
0.17 '
0.04
0.01
0.02
0.30
0.03
a
a
0.82
1.00
2.57
aLess than 0.005.
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TABLE 3. SALES FOR FINAL DEMAND, BY ECONOMIC SECTOR, NORTH DAKOTA, 1958-1975 (MILLION DOLLARS)
Year
1958
1959
1960
1961
196Z
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
(A)
Agriculture,
Livestock
220.3
217.3
175.4
213.9
199.3
207.7
213.3
247.5
271.5
280.9
264.2
265.0
272.5
304.7
367.4
475.9
448.5
452.8
(B)
Agriculture,
Crops
440.3
394.9
390.9
341.7
476.8
543.1
451.2
554.5
609.4
568.4
570.5
641.8
671.0
673.7
975.0
1,795.7
2,072.1
1,555.8
(C)
Contract
Construction
18.3
27.2
32.7
24.0
16.5
17.1
30.2
31.0
23.3
24.4
27.0
35.2
182.1
60.7
72.9
61.6
72.3
82.9
(D)
Wholesale
Trade & Ag
Processing
62.5
57.0
66.1
67.5
62.6
73.0
78.4
78.4
84.2
91.7
101.5
162.0
148.1
162.0
170.0
243.0
304.8
306.6
(E)
Retail
Trade
16.5
18.0
14.9
17.2
18.7
21.7
26.2
33.0
45.0
54.7
69.7
75.8
85.7
93.8
86.3
94.5
92.6
112.5
(F)
Business i
Personal
Service
5.5
6.0
5.0
5.8
6.3
7.2
8.7
11.0
15.0
18.2
23.2
25.3
28.5
31.3
28.8
31.5
30.9
37.5
(G)
5,
Households
187.0
186.5
187.9
237.2
344.2
334.. 5
485.2
361.4
428.6
380.8
447.9
501.5
567.7
605.1
649.0
726.7
806.0
1,046.9
(H)
Coal
Mining
1.1
1.0
1.0
1.3
1.5
1.3
1.5
1.5
1.3
2.1
2.4
2.4
3.2
3.5
3.3
4.1
4.9
7.1
(D
Electric
Generating
---
4.4
8.4
12.3
11.7
13.8
17.5
21.4
19.3
22.4
21.6
(0)
Petroleum/
Natural Gas
Extraction
5.4
10.9
14.5
21.0
22.8
23.3
25.9
28.0
29.7
28.0
..34.3
26.2
30.3
32.9
34.6
38.4
76.1
93.1
(K)
Petroleum
Refining Total
13.1
12.9
12.5
12.6
12.5
12.5
12.7
13.4
14.0
14.6
14.7
14.9
15.2
16.0
17.0
19.2
22.8
27.2
970.0
931.7
900.9
942.2
1,161.2
1,241.4
1,333.3
1,359.7 co
1,526.4
1,472.2
1,567.7
1,761.8
2,018.1
1,969.9
2,425.7
3,509.9
3,953.4
3,744.0
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- 9 -
Manufactured exports are in Columns D, I, and K. Estimated outlays for
tourism are allocated in Columns E and F, while federal government outlays
for construction is Column C and federal payrolls is Column G.
The estimates of personal income obtained by input-output techniques
are presented in the first column of Table 4. For each year, the result is
the sum of the products of the sales by the column sector (Table 3) and the
coefficient in Row 12 of the interdependence coefficients matrix (Table 2)
for that sector. For example, the $1,022 million of estimated personal
income in 1958 (Table 4) is equal to ($220.3 million x 1.05) + ($440.3
million x .96) + ($18.3 million x .61) + ($62.5 million x .79) + ($16.5
million x .40) + ($5.5 million x .72) + ($187.0 million x 1.55) + ($1.1
million x .67) + ($5.4 million x .32) + ($13.1 million x .30) = $231.3
million + $422.7 million + $11.2 million + $49.4 million + $6.6 million +
$4.0 million + $289.9 million + $0.7 million + $1.7 million + $4.0 million.
(The data shown in the above example are rounded numbers which are slightly
different from the unrounded ones from the computer calculations.)
The results of these calculations for each year were compared with
estimates of personal income in North Dakota that are assembled by the U.S.
Department of Commerce, which appear in the second column of Table 4. The
last column of the table indicates the difference in the first two columns,
expressed as a percentage of the Department of Commerce estimate. This
difference is less than 5 percent for 10 of the 18 years and only 6 years
have differences of more than 6 percent. Of these 6 years, one was 1964
(when the Minuteman construction was occurring) and another was 1970 (when
the ABM construction was in progress). Input-output analysis overestimated
personal income in those years because reporting of government outlays
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- 10 -
TABLE 4. PERSONAL INCOME, NORTH DAKOTA, 1958-1975
Year
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975 .
Average Difference
Estimated by
Input-Output
Techniques ($000)
$1,022,420
978,397
942,474
1,011,456
1,285,782
1,353,838
1,521,163
1,470,114
1,662,434
1,572,975
1,684,427
1,890,981
2,117,311
2,156,709
2,592,109
3,674,768
4,104,582
4,013,695
Reported by U.S.
Department of
Commerce ($000)a
$1,027,000
953,000
1,081,000
964,000
1,361,000
1,283,000
1,272,000
1,498,000
1,556,000
1,595,000
1,644,000
1,850,000
1,913,000
2,173,000
2,545,000
3,663,000
3,629,000
3,652,000
Percentage
Difference
-0.5
2.7
-12.8
4.9
-5.5
5.5
19.6
-1.9
6.8
-1.4
2.5
2.2
10.7
-0.7
1.9
0.3
13.1
9.9
5.72
As reported by the Bureau of Economic Analysis, U.S. Department of
.Commerce, in Survey of Current Business, August, 1976.
Without respect to sign.
implied that all the expenditures occurred in those years, whereas they
actually were distributed over more than one year.
Figure 1 indicates the results of the analysis in graphic form. The
solid line indicates North Dakota personal income reported by the Department
of Commerce for the years 1958-1975. The dotted line represents estimates
for those years obtained from the input-output model.
Regions in North Dakota
The regions in North Dakota for which exports of coal, electricity,
or crude or refined petroleum constitute a part of the economic base are
Regions 1, 2, 7, and 8 (Figure 2). Final demand vectors for those regions
for the years 1958-1975 are presented in Table 5.
-------
North Dakota Personal
Income (Billion Dollars)
- 11 -
.0
3.8
3.6
3.4
3.2
3.0
2.3
2.6
2.4
2.2
2.0
1.3
1.6
1.4
1.2
1.0
.8
.6
.4
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19158 60 62 64 66 68 70 72 74
Figure 1. Personal Income in North Dakota, as Reported by the U.S
Department of Commerce and Estimated by Input-Output Procedures,
1958-1975.
-------
Cavalier 019 I Pembina067
Bottineau 009
Mountrail 061
Ward 101
SR
\^
McKenzie 053
Nelson Grand Forks
0631 035
Griggs BSteele
0391 091
Kidder043iStutsman 093
Barnes 003 cass 017
Hettinger 041 ~M °37
LaMoure 045
Sargent 081
MeIntosh 051 Dickey 021
Figure 2. State Planning Regions in North Dakota.
-------
TABLE 5. SALES FOR FINAL DEMAND, BY ECONOMIC SECTOR, NORTH DAKOTA REGIONS, 1958-1975 (MILLION DOLLARS)
(A)
Agriculture,
Year Livestock
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1958
1959
1960
1961
1962
1963
1964
1965
1965
1967
1968
1969
1970
1971
1972
1973
1974
1975
10.3
9.8
8.0
10.0
9.2
10.1
10.9
13.1
14.3
14.8
13.9
13.8
15.0
17.9
21.5
26.8
23.4
22.7
24.2
22.9
18.8
23.3
21.5
22.5
23.3
27.2
28.4
29.9
26.2
26.0
28.1
35.5
39.7
49.2
45.2
44.8
(B)
Agriculture,
Crops
16.2
14.4
19.2
10.6
28.4
36.2
24.2
26.5
32.9
28.2
26.4
40.0
38.3
34.1
59.6
115.2
128.0
85.5
46.9
50.1
53.0
23.2
85.4
89.0
74.7
78.2
95.8
65.7
72.5
95.8
94.2
91.7
133.6
311.3
300.8
205.0
(C)
Contract
Construction
.8
1.1
1.4
1.1
.7
.8
1.3
1.4
1.0
1.1
1.2
1.5
.7
.7
2.5
.3
1.1
.9
2.2
3.3
3.9
2.9
2.0
2.1
3.6
3.7
2.8
2.9
3.2
2.1
2.9
5.0
4.2
7.0
5.7
5.4
(D) (E)
Wholesale
Trade & Ag Retail
Processing Trade
2.7
2.3
2.6
2.5
2.2
2.4
2.6
2.6
2.8
3.1
3.3
5.4
4.9
5.4
5.6
8.0
10.1
10.2
7.8
7.4
8.8
9.3
8.9
10.6
11.3
11.3
12.1
13.5
14.7
23.3
21.3
23.3
24.5
34.9
43.8
44.1
.9
1.0
.8
1.0
1.0
1.2
1.5
1.8
2.5
3.0
3.8
4.2
4.7
5.2
4.7
5.2
5.1
6.2
2.5
2.8
2.3
2.7
2.9
3.4
4.0
5.1
6.9
8.4
10.7
11.7
13.2
14.4
13.3
14.6
14.3
17.3
(F) (G) (H) (I)
Business &
Personal Coal Electric
Service Households Mining Generating
Region 1
.3
.3
.3
.3
.3
.4
.5
.6
.8
1.0
1.3
1.4
1.6
1.7
1.6
1.7
1.7
2.1
Region 2
.9
.9
.8
.9
1.0
1.1
1.4
1.7
2.3
2.8
3.6
3.9
4.4
4.8
4.4
4.9
4.8
5.8
5.8 .1
6.4 .1
7.3 .1
7.6 .2
9.5 .2
9.8 .1
12.8 .1
11.0
12.5
12.0
13.7
21.0
18.9
23.0
22.8
25.6
27.3
31.0
31.3
29.1
33.0
39.1
78.9
69.7
124.1
71.0
91.8
68.8
89.0
102.6
129.5
131.4
120.4
146.7
178.0
297.3
(J)
Petroleum/
Natural Gas
Extraction
17.6
20.7
25.5
26.5
30.2
32.7
36.3
37.6
38.8
33.4
33.4
28.2
28.9
31.3
31.3
33.2
72.0
86.4
7.3
12.5
16.8
20.9
21.7
21.6
24.0
25.4
23.6
21.5
21.5
20.0
21.5
24.4
25.8
25.6
47.9
57.8
(K) (L)
Petroleum
Refining Total
4.8
4.7
4.6
4.6
4.6
4.5
4.4
4.6
4.6
4.6
4.6
4.7
5.1
6.1
6.4
7.3
8.6
9.6
__
--
--
--
--
59.5
60.8
69.8
64.4
86.3
98.2
94.6
99.2
110.2
101.2
101.6
120.2
118.1
125.4
156.0
223.3
277.3
254.6
123.1
129.0
137.4
122.3
222.3
220.0
266.4
223.6
263.7
213.5
241.4
285.4
315.1
330.5
365.9
594.2
640.5
677.5
CO
I
- continued -
-------
TABLE 5. SALES FOR FINAL DEMAND, BY ECONOMIC SECTOR, NORTH DAKOTA REGIONS, 1958-1975 (MILLION DOLLARS) (CONTINUED)
(A)
Agriculture,
Year Livestock
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
54.3
53.4
41.6
52.6
47.3
50.7
53.2
62.2
71.6
73.5
72.0
72.5
76.2
83.1
103.4
131.7
119.7
118.6
27.4
27.5
21.3
25.8
23.3
24.7
26.3
30.9
35.2
38.3
38.3
38.6
38.9
43.8
58.2
74.7
70.9
70.0
(B)
Agriculture,
Crops
50.2
31.0
40.7
14.1
63.7
54.9
52.5
60.7
66.5
54.6
61.1
67.0
63.3
64.3
96.7
148.4
156.9
160.0
40.7
24.5
26.0
18.2
33.6
43.2
29.9
35.4
46.6
49.0
36.0
36.7
42.4
42.5
64.9
113.6
161.0
91.1
(C) (D) (E) (F) (G)
Wholesale Business &
Contract Trade & Ag Retail Personal
Construction Processing Trade Service Households
3.4
5.1
6.0
4.5
3.0
3.2
5.6
5.7
4.3
4.5
5.0
6.4
4.7
4.2
4.8
2.1
4.4
13.7
1.0
1.5
1.8
1.3
.9
.9
1.6
1.7
1.3
1.3
1.5
2.2
2.0
4.1
1.4
.4
1.8
1.8
11.7
10.3
11.6
11.6
10.5
11.7
12.6
12.6
13.5
15.0
.16.3
25.9
23.7
25.9
27.2
38.9
48.7
49.0
2.6
2.6
3.2
3.6
3.7
4.6
4.9
4.9
5.3
4.0
6.4
10.2
9.3
10.2
10.7
15.3
19.2
19.3
Region
2.8
3.0
2.5
2.9
3.2
3.7
4.4
5.5
7.6
9.2
11.7
12.8
14.5
15.8
14.6
16.0
15.6
19.0
Region
1.2
1.3
1.1
1.3
1.4
1.6
1.9
2.4
3.3
4.0
5.1
5.5
6.2
6.8
6.3
6.9
6.8
8.2
7
.9
1.0
.8
1.0
1.1
1.2
1.5
1.8
2.5
3.1
3.9
4.3
4.8
5.3
4.9
5.3
5.2
6.3
8
.4
.4
.4
.4
.5
.5
.6
.8
1.1
1.3
1.7
1.8
2.1
2.3
2.1
2.3
2.3
2.7
24.3
27.0
30.7
32.1
40.3
41.3
54.5
46.4
53.1
50.7
57.9
77.3
83.8
97.3
113.1
130.5
141.4
169.2
6.2
7.2
8.2
8.3
8.7
9.5
10.7
11.2
12.1
12.1
13.9
22.3
29.3
23.1
23.9
27.2
29.2
35.7
(H) (I) (0)
Petroleum/
Coal Electric Natural Gas
Mining Generating Extraction
.6
.5
.6
.8
.9
.8
1.1
1.3
1.2
1.8
2.1
2.2
2.9
3.2
2.9
3.7
4.4
5.1
.3
.3
.3
.3
.4
.3
.3
.2
.2
.2
.3
.2
.3
.3
.4
.4
.5
2.0
__
--
__
4.4
8.4
12.3
11.7
13.8
17.5
21.4
19.3
22.4
21.6
_.
__
_.
__
__
__
__
_.
__
__
.8
.7
1.2
2.3
3.6
4.1
4.0
5.4
8.2
11.0
16.9
14.5
16.9
14.7
15.0
18.1
37.6
45.8
(K) (L)
Petroleum
Refining Total
38.8
38.2
37.1
37.4
37.2
37.1
37.9
40.0
42.0
43.9
44.2
44.8
45.7
47.3
50.2
56.8
67.3
75.4
..
._
--
._
..
._
..
__
187.0
169.5
171.6
157.0
207.2
204.6
223.3
236.2
266.7
264.7
286.5
324.9
333.4
363.9
439.2
552.7
586.0
637.9
80.6
66.0
63.5
61.5
76.1
89.4
80.2
92.9
113.3
121.2
120.1
132.0
147,4
147.8
182.9
258.9
329.3
276.6
-------
- 15 -
Interdependence coefficients were multiplied by the final demand
vectors for each of the regions in each of the years in the manner pre-
viously described for North Dakota. The resulting estimates of personal
income are shown in the first column for each region in Table 6. The U.S.
Department of Commerce estimate of personal income for each region and the
percentage difference in the two estimates also are presented in Table 6,
as are the estimates of personal income that were derived by disaggregation
procedures for each region and the difference of those estimates from the
input-output based estimates.
The average differences between the estimates of personal income
obtained by input-output techniques and those reported by the U.S. Depart-
ment of Commerce were 23.6, 11.0, 3.8, 18.4 percent, for Regions 1, 2, 7,
and 8, respectively (Table 6). The average of the average differences for
the four regions was 14.2 percent. Corresponding differences of input-
output estimates from those obtained by disaggregation techniques for the
four regions were 11.9, 12.6, 7.4, and 14.0 percent, for an overall average
difference of 11.5 percent.
Figures 3, 4, 5, and 6 provide graphic indication of the levels of
personal income reported by the Department of Commerce for the four regions
relative to the levels estimated by the input-output and by disaggregation
techniques. Although the estimates based on input-output techniques are
somewhat more volatile than the other two estimates, a consistent pattern
is evident for most years. The years since 1973 appear to involve more
divergence of estimates than is true for other years. This likely is due,
at least in part, to the fact that some of the data are preliminary, both for
the final demand vectors and the Department of Commerce estimates of per-
sonal income. These data often are revised several times during the five-
year period following each year.
-------
TABLE 6. ESTIMATES OF PERSONAL INCOME AND DIFFERENCES IN ESTIMATES, BY REGION, NORTH DAKOTA, 1958-1975
Year
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
Average
Dif.a
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
Average
Dif.a
1-0
Analysis
Estimate
(Mil. $)
45.0
44.3
50.3
44.7
64.7
74.8
70.5
72.8
83.3
77.4
78.2
102.9
99.0
105.8
134.9
199.9
225.9
195.4
159.6
144.1
148.2
135.8
189.3
187.2
210.9
216.6
245.5
236.8
257.4
302.7
312.7
346.0
425.3
530.3
564.3
618.2
Department
of Commerce
Estimate
(Mil. $)
N/A
70.0
N/A
N/A
83.1
N/A
N/A
76.6
78.8
79.6
78.8
87.6
84.7
82.2
102.5
140.2
130.7
N/A
N/A
135.8
N/A
N/A
179.1
N/A
N/A
231.6
243.0
250.6
259.6
298.5
315.8
346.5
409.0
516.8
515.3
N/A
Difference
(X)
State Region 1
-36.7
-22.1
-5.0
+5.7
-2.8
-0.8
+17.5
+16.9
+28.7
+31.6
+42.6
+72.8
23.6
State Region 7
+6.1
+5.7
-6.5
+1.0
-5.5
-0.8
+1.4
-1.0
-0.1
+4.0
+4.5
+9.5
3.8
Disaggregation
Procedure
Estimate
(Mil. $)
57.5
54.6
59.7
51.8
74.6
70.3
64.6
72.9
74.9
73.0
73.5
88.2
87.2
95.3
119.8
203.6
182.9
172.7
157.5
142.0
163.5
144.2
217.5
196.6
201.2
233.1
239.5
239.9
249.6
277.6
284.8
325.0
377.7
495.2
481.9
530.0
Difference
(X)
-21.7
-18.9
-15.7
-13.7
-13.3
+6.4
+9.1
-0.1
+11.2
+6.0
+6.4
+16.7
+13.5
+11.0
+12.6
-1.8
+23.5
+13.1
11.9
+1.3
+1.5
-9.4
-5.8
-13.0
-4.8
+4.8
-7.1
+2.5
-1.3
+3.1
+9.0
+9.8
+6.5
+12.6
+7.1
+17.1
+16.6
7.4
1-0
Analysis
Estimate
(Mil. $)
130.6
131.0
138.2
124.9
244.4
236.2
310.4
236.6
287.8
226.1
262.8
309.7
355.1
367.9
395.9
628.6
676.1
773.6
81.4
67.8
65.0
62.8
76.0
88.9
80.4
92.2
110.3
116.2
111.2
128.0
145.2
142.5
178.9
252.6
307.7
254.0
Department
of Commerce
Estimate
(Mil. $)
N/A
138.2
N/A
N/A
213.2
N/A
N/A
246.9
255.9
265.9
276.3
297.9
302.3
327.8
373.9
560.8
545.7
N/A
N/A
59.4
N/A
N/A
83.8
N/A
N/A
91.8
95.3
95.5
95.8
114.0
116.0
123.5
151.0
220.0
195.5
N/A
Difference
(X)
State Region 2
-5.2
+14.6
-4.2
+12.5
-15.0
-4.9
+4.0
+17.5
+12.2
+5.9
+12.1
+23.9
11.0
State Region 8
+14.1
-9.3
+0.4
+15.7
+21.7
+16.1
+12.3
+25.2
+15.4
+18.5
+14.8
+57.4
18.4
Disaggregation
Procedure
Estimate
(Mil. $)
151.4
150.2
170.0
152.6
227.3
212.8
216.6
249.8
270.9
274.4
287.6
325.3
339.7
378.8
436.7
642.5
603.9
601.0
74.0
58.9
68.2
56.0
88.5
82.2
75.9
91.3
97.4
101.0
95.8
107.8
107.9
126.7
154.5
234.7
236.3
213.6
Difference
(X)
-13.7
-12.8 -
-18.7
-18.2
+7.5
+11.0
+43.3
-5.3
+6.2
-17.6
-8.6
-4.8
+4.5
-2.9
-9.3
-2.2
+12.0
+28.7
12.6
+10.0
+15.1
-4.7
+12.1
-14.1
+7.6
+5.9
+0.1
+13.2
+15.0
+16.1
+18.7
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-------
North Dakota State Region 1
Personal Income (Million Dollars)
- 17 -
850
800
750
700
650
600
550
500
450
400
350
300
250
200
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Figure 3. Personal Income in Region 1, North Dakota, as Reported by U.S. Depart
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tion Techniques, 1958-1975.
-------
North Dakota State Region 2
Personal Income (Million Dollars)
- 18 -
850
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- 19 -
North Dakota State Recnm; 7
Personal Income (Million Dollars)
850
800
750
700
650
600
550
500
450
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300
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Income Data*
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Output Techniques
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Table for 1958, 1960, 1961,
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Figure 5. Personal Income in Region 7, North Dakota, as Reported by U.S.
Department of Commerce and as Estimated by Input-Output Procedures and
Disaggregation T :niques, 1958-1975.
-------
- 20 -
North Dakota State Region 8
Personal Income (Million Dollars)
850
800
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1958 60 62 64 66 68 70 72 74
Figure 6. Personal Income in Region 8, North Dakota, as Reported by U.S
Department of Commerce and as Estimated by Input-Output Procedures and
Disaggregation Techniques, 1958-1975.
-------
- 21 -
Montana
The area in Montana that was of particular interest in this study was
a nine-county area in southeastern Montana (Figure 7). Personal income
estimates were made by input-output techniques for that region and for the
state of Montana. Disaggregation procedures also were used to estimate
personal income in the region. The procedures used were identical to those
used for North Dakota and North Dakota's regions. Estimates of final demand
vectors for the state and region for the years 1958-1975 are presented in
Table 7. The resulting estimates of personal income for Montana and south-
eastern Montana are presented in Table 8 and in Figures 8 and 9.
Input-output techniques appear to have a significant downward bias,
both at the state level and at the regional level. The state level estimate
obtained by input-output analysis averages about 25 percent less than that
reported by the U.S. Department of Commerce and the corresponding difference
for the region is about 27 percent. Disaggregation procedures for deriving
estimates of personal income in the nine southeastern Montana counties
provided estimates that were consistently less than the Department of Commerce
estimates for the years prior to 1973. However estimates based on disaggrega-
tion procedures rose rapidly in recent years so input-output based estimates
averaged 27 percent below those obtained by disaggregation procedures also.
However, both the state and the regional estimates based on input-output
analysis differ from the Department of Commerce estimates by a rather consistent
amount in the respective years.
Wyomi ng
Eight counties in northeastern Wyoming (Figure 10) were regarded as
a region that could be impacted by coal development. The final demand
-------
MONTANA
Figure 7. Montana and Nine-County Region in Southeastern Montana.
-------
TABLE 7. SALES FOR FINAL DEMAND, BY ECONOMIC SECTOR, MONTANA AND SOUTHEASTERN MONTANA, 1958-1975 (MILLION DOLLARS)
(A)
Agriculture,
Year Livestock
(B)
Agriculture,
Crops
(C)
Contract
Construction
(D)
Wholesale
Trade & Ag
Processing
(E) (F) (G)
Business &
Retail Personal
Trade Service Households
(H) (I) (J) (K) (L)
Petroleum/
Coal Electric Natural Gas Petroleum
Mining Generating Extraction Refining Total
Montana
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
240.5
215.8
222.1
215.2
205.9
185.8
201.8
243.9
289.2
267.2
319.4
352.7
355.9
408.6
495.4
564.0
433.1
420.7
220.4
203.0
200.9
167.1
226.7
244.3
225.1
228.2
282.8
289.9
258.3
261.5
329.3
303.0
431.6
575.1
769.9
667.0
16.9
31.3
30.7
30.9
33.9
42.4
52.0
59.1
51.6
52.6
57.7
75.9
79.3
82.6
254.5
58.0
68.3
128.3
58.1
62.3
63.4
67.3
65.8
67.0
69.7
74.0
79.3
80.6
84.0
91.0
98.2
104.7
109.8
129.9
152.9
175.2
36.8
39.8
44.3
52.2
60.1
68.0
75.9
83.8
91.7
99.6
122.5
135.1
148.5
157.8
173.6
187.0
200.4
213,8
12.3
13.3
14.8
17.4
20.0
22.7
25.3
27.9
30.6
33.2
40.8
45.0
49.5
52.6
57.9
62.2
66.5
70.8
Southeastern
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
52.6
50.2
49.0
43.0
38.1
35.3
42.3
51.7
61.2
55.6
62.4
71.6
80.6
90.3
115.2
122.0
107.1
94.8
36.8
25.2
24.8
20.3
26.5
33.3
31.0
26.3
31.1
35.2
33.9
33.6
38.0
32.6
43.4
58.8
90.0
64.6
3.7
6.8
6.7
6.8
7.5
9.3
11.4
13.0
11.3
11.6
12.3
11.5
17.4
23.4
3.5
20.3
12.5
25.4
18.7
19.9
20.0
20.9
20.1
19.8
20.2
21.1
22.2
22.2
23.1
25.5
28.0
30.4
31.9
37.7
44.3
60.0
7.1
7.6
8.5
10.0
11.5
13.1
14.6
16.1
17.6
19.1
23.5
25.9
28.5
30.3
33.3
35.9
38.5
41.0
2.4
2.6
2.8
3.3
3.8
4.4
4.9
5.4
5.9
6.4
7.8
8.6
9.5
10.1
11.1
11.9
12.8
13.6
218.4
246.6
268.3
365.9
317.2
390.5
342.2
418.2
395.2
493.0
570.8
578.6
625.5
672.4
709.3
823.2
914.3
1,023.3
Montana
34.2
38.6
42.0
57.3
49.7
61.1
53.6
65.5
61.9
77.2
83.2
91.6
96.5
101.5
108.2
128.5
160.5
160.8
1.2
1.0
.7
.6
.5
.4
.3
.4
.6
.3
.5
1.4
5.1
12.1
15.9
29.5
43.0
56.5
1.2
1.0
.7
.6
.5
.4
.3
.4
.6
.3
.5
1.4
5.1
12.1
15.9
29.5
43.0
56.5
36.3
40.1
37.9
35.8
42.1
41.6
47.2
50.8
52.2
58.1
64.7
62.9
69.8
79.7
96.9
108.2
116.0
123.8
17.9
50.2
47.3
45.5
54.1
52.9
62.9
66.0
67.8
75.7
84.6
82.6
91.6
104.9
129.3
143.6
152.4
161.2
840.9
853.2
883.1
952.4
972.2
1,062.7
1,039.5
1,186.3
1,273.2
1,374.5
1,518.7
1,604.1
1,681.8
1,873.5
2,344.9
2,537.1
2,764.4
2,879.4
174.6
202.1
201.8
207.7
211.8
229.6
241.2
265.5
279.6
303.3
331.3
352.3
395.2
435.6
491.8
588.2
661.1
677.9
IN3
U)
-------
TABLE 8. ESTIMATES OF PERSONAL INCOME AND DIFFERENCES IN ESTIMATES, MONTANA AND MONTANA REGION,
1958-1975
Year
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
Average
Dlf.
1-0
Analysis
Estimate
(Mil. $)
894.2
910.3
951.1
1,070.4
1,050.0
1,170.8
1,108.6
1,287.5
1,357.1
1,501.0
1,668.4
1,743.2
1,905.5
2,028.8
2,427.3
2,731.2
2,967.7
3,098.6
Montana
Southeast Montana
Dept. of Commerce
Estimate
(Mil. $)
1,354.0
1,345.2
1,382.0
1,369.0
1,580.0
1,588.0
1,595.0
1,724.7
1,872.7
1,924.7
2,033.2
2,203.1
2,442.7
2,539.0
2,914.0
3,460.1
3,643.7
4,054.0
Difference
(*)
-34.0
-32.3
-31.2
-21.8
-33.5
-26.3
-30.5
-25.3
-27.5
-22.0
-17.9
-20.9
-22.0
-21.9
-16.7
-21.1
-18.6
-23.6
24.8
1-0
Analysis
Estimate
(Mil. $)
171.2
176.9
180.0
194.3
186.6
209.4
208.3
235.7
246.1
271.3
293.1
318.4
352.1
380.1
427.6
510.8
588.7
585.2
Dept. of Commerce
Estimate
(Mil. $)
N/A
272.3
N/A
N/A
296.9
N/A
N/A
327.5
352.5
370.0
401.8
423.5
470.5
500.9
567.3
644.6
687.8
N/A
Difference
(*)
-35.0
-37.2
-28.0
-30.2
-26.7
-27.1
-24.8
-25.2
-24.1
-24.6
-20.8
-14.4
26.5
Region
Disaggregation
Procedure
Estimate
(Mil. $)
260.7
262.4
266.5
264.3
288.2
300.1
303.9
325.2
348.2
362.5
386.6
417.9
464.7
490.9
556.5
648.5
713.4
776.3
Difference
(%)
-34.3
-32.6
-32.5
-26.5
-35.3
-30.2
-31.5
-27.5
-29.3
-25.2
-24.2
-23.8
-24.2
-22.6
-23.1
-21.2
-17.5
-24.6
27.0
I
ro
-------
Montana Personal Income
(Billion Dollars)
4.2
- 25 -
4.0
3.8
3.6
3.4
3.2
3.0
2.8
2.6
2.4
2.2
2.0
1.
1.6
1.4
1.2
1.0
.8
.6
1
3!
.4
.2
-;
[-4-
;!
rfr
I
-:ffr
rill
ttu
ii-L-1
ft
~V'
rTf:
4^1
-t
->r-
r--
r:
__i;_
U.S. Dept. of Commerce
Income Data
Personal Income by Input- L
Output Techniques F
1958 60 62 64 66 68 70 72 74
Figure 8. Personal Income in Montana, as Reported by the U.S. Depart-
ment of Commerce and Estimated by Input-Output Procedures, 1958-1975
-------
- 26 -
Southeast Montana Region
Personal Income (Million Dollars)
850
800
- - -I1
750
700
650
600
550
500
450
400
350
300
250
200
150
100
50
m
it T >i
U.S. Dept. of Commerce
Income Data*
Personal Income by Input-
Output Techniques
xxx Personal Income by Disaggrega-TUf
tion Techniques
*Not available for 1958, 1960, 1961,
1963, 1964, and 1975.
iii
ilk
iM
-P7-1-
iTt;
ffi
fj}4
ftll
f
14
W
4-T-i
ii± Ijrr
!HT--ttH
hUF
tfH
.hdi
i i n
; irtt
H-'-
H4-r
fif
urr
rrr
I
38
±tU
TTTT-rrr
im
4TO
~hrr-
F--
r'T"
rh;
-FTf
LF
ittt
TT!
rnr
.l-ir;
.! r;r
ttt
/: ^
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at
i.rH
T.t a
±tt:
H;!?
-H-
fitf
U.I-
r 11 j
it
M4ii
ittt
m
tixL
Iff-!
itr
Htt
ffi
i r-,-
§
m
ffir
m-
i±tr
ijii
Iff
ffl
-m
L.Tl
Hi-
lit
Ttr
ttft
^i
;SP
s
I
m
14"
iiii
iui
rru
"t~;"r
i I '
I i I
I i
1958
Figure
1
60 62 64 66 68 70 72 74
9. Personal Income in Southeast Montana as Reported bv U S
by Input-Output Procedure^
-------
WYOMING
Figure 10. Wyoming and Eight-County Region in Northeastern Wyoming.
-------
- 28 -
vectors that were assembled for that region and for the state of Wyoming are
presented in Table 9. Procedures for using input-output analysis to estimate
personal income in Wyoming were the same as for North Dakota and Montana.
The same procedures used in disaggregating personal income to the county
level for North Dakota and Montana also were used for Wyoming. Estimates of
personal income obtained by input-output procedures were expressed as per-
centage differences from Department of Commerce estimates at the state and
regional level (Table 10). Similar comparisons were made at the regional
level of input-output based estimates and those obtained by disaggregation
procedures. Input-output estimates of personal income averaged about 15
percent less than Department of Commerce estimates at the state level and 22
percent less at the regional level. Input-output estimates of regional
personal income averaged 19.5 percent less than those obtained by disaggre-
gation procedures.
As was true for North Dakota and Montana, the input-output based
personal income estimates for Wyoming (Figure 11) and northeastern Wyoming
(Figure 12) are somewhat more erratic than the other types of estimates.
However, except for the years since 1973, the three types of estimates
parallel each other rather consistently. As is likely for the other two
states, divergence in recent years may be reduced as preliminary data are
revised by state and federal agencies.
CONCLUSIONS
The results of the work conducted under Phase I of this study indicate
that the input-output coefficients developed for North Dakota provide satis-
factory estimates of personal income in the four western regions of North
Dakota. The 17 sector model (which includes coefficients collected in
-------
TABLE 9. SALES FOR FINAL DEMAND, BY ECONOMIC SECTOR, WYOMING AND NORTHEASTERN WYOMING, 1958-1975 (MILLION DOLLARS)
(A)
(8)
(C)
(K)
(0) (E) (F) (G) (H) (I) (0)
Wholesale Business & Petroleum/
Agriculture, Agriculture, Contract Trade & Ag Retail Personal Coal Electric Natural Gas Petroleum
Year Livestock Crops Construction Processing Trade Service Households Mining Generating Extraction Refining Total
Wyoming
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
135.4
135.2
129.2
123.6
122.6
128.1
125.0
145.1
174.6
161.4
186.0
199.4
195.6
218.0
281.8
328.6
235.5
250.3
38.7
44.2
37.9
38.5
33.7
44.0
40.7
35.2
44.8
47.0
50.8
50.9
52.8
56.9
74.4
79.9
122.6
101.5
20.2
29.1
26.1
25.8
27.8
38.9
36.5
48.3
38.3
37.3
41.5
38.8
37.3
35.8
44.9
32.9
30.6
96.8
22.9
25.2
26.2
27.0
28.2
24.2
27.3
26.3
28.2
29.1
31.4
34.9
38.4
40.8
42.0
49.3
64.9
71.0
26.3
27.0
28.1
37.8
47.5
57.2
67.0
76.7
86.4
96.1
105.8
115.6
125.3
135.0
144.7
155.9
165.1
177.4
8.9
9.0
9.4
12.6
15.8
19.1
22.3
25.6
28.8
32.0
35.3
38.5
41.8
45.0
48.2
52.0
55.2
59.1
Northeastern
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
52.3
52.5
48.5
47.7
43.5
47.2
46.7
54.2
64.8
57.5
68.6
73.4
73.0
80.9
105.0
126.9
90.8
96.5
4.9
5.4
4.2
3.3
5.6
6.7
5.4
5.1
5.4
6.8
5.3
5.5
5.9
5.8
8.2
10.5
10.4
9.1
7.4
10.6
9.5
9.4
10.2
14.2
13.3
17.6
14.0
13.6
11.8
14.8
13.5
12.9
19.9
12.0
11.4
34.2
10.3
11.1
11.4
11.6
12.0
10.2
11.5
10.9
11.6
12.0
14.1
17.4
21.1
24.5
26.9
31.5
41.6
45.4
8.2
8.4
8.7
11.7
14.7
17.7
20.8
23.8
26.8
29.8
32.8
35.8
38.8
41.9
44.9
48.3
51.2
55.0
2.8
2.8
2.9
3.9
4.9
5.9
6.9
7.9
8.9
9.9
10.9
11.9
13.0
14.0
14.9
16.1
17.1
18.3
155.7
172.6
182.4
172.1
181.8
303.2
237.7
210.7
224.3
250.7
276.4
298.7
306.6
314.5
349.0
568.8
456.8
505.9
Wyoming
36.4
40.3
42.6
110.2
42.5
70.9
55.6
49.2
52.4
58.6
68.5
73.8
72.8
71.7
79.3-
120.6
102.8
126.0
3.0
3.5
3.6
4.7
3.9
4.9
3.9
3.3
4.1
3.3
3.2
3.7
13.1
14.9
21.3
31.7
38.6
45.8
1.5
2.3
2.4
2.8
3.0
3.3
3.7
3.8
4.2
4.3
4.4
4.5
6.6
7.0
8.0
10.6
12.8
14.9
14.2
13.8
13.5
12.0
10.5
9.0
7.5
6.0
8.3
9.9
12.6
14.4
16.2
15.0
22.8
27.9
33.9
38.7
10.2
9.8
9.5
8.4
7.4
6.3
5.3
4.2
5.8
6.8
8.8
10.1
11.3
10.5
15.9
18.6
22.4
25.3
212.2
222.7
234.7
253.6
243.3
245.5
250.1
249.0
243.8
250.3
269.8
300.2
306.0
312.7
352.6
405.6
446.3
488.5
59.6
65.1
69.9
72.7
69.1
73.6
80.8
85.6
86.6
89.4
97.9
117.3
140.1
143.3
162.0
186.8
198.3
211.5
87.0
92.8
95.6
103.8
110.1
109.9
97.4
103.6
106.2
100.6
110.7
117.3
127.7
140.2
158.3
174.4
189.6
202.3
52.0
55.7
57.4
62.3
66.1
65.8
58.4
62.2
63.7
60.4
66.4
70.4
76.6
84.1
95.0
104.6
112.8
122.1
724.5
775.1
786.7
811.5
825.2
984.0
915.4
929.8
987.8
Ii017.7
1,123.5
1,212.4
1,260.8
1,328.8
1,540.0
1,907.0
1,839.1
2,037.3
245.6
264.0
267.0
274.0
279.0
321.8
308.4
324.5
344.2
349.1
339.5
434.9
472.7
496.6
580.0
686.5
671.6
758.3
-------
TABLE 10. ESTIMATES OF PERSONAL INCOME AND DIFFERENCES IN ESTIMATES, WYOMING AND WYOMING REGION,
1958-1975
Year
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
Average
Dif.
1-0
Analysis
Estimate
(Mil. $)
569.2
613.4
620.6
614.6
629.7
844.5
740.1
727.1
790.5
826.6
916.8
985.6
1,015.7
1,069.1
1,244.4
1,676.3
1,487.6
1,635.8
Wyoming
Northeast Wyoming
Dept. of Commerce
Estimate
(Mil. $)
668.0
723.3
744.0
774.0
802.9
819.0
832.0
863.0
898.7
946.5
1,010.9
1,123.8
1,272.9
1,313.0
1,479.6
1,725.7
1,941.4
2,294.0
Difference
(%)
-14.8
-15.2
-16.6
-20.6
-21.6
-3.1
-11.0
-15.7
-12.0
-12.7
-9.3
-12.3
-20.2
-18.6
-15.9
-2.9
-23.4
-28.7
15.3
1-0
Analysis
Estimate
(Mil. $)
173.3
186.0
185.9
184.7
188.5
241.6
218.5
222.5
240.8
246.5
279.9
307.7
321.2
335.1
394.5
498.3
451.4
520.9
Dept. of Commerce
Estimate
(Mil. $)
N/A
257.5
N/A
N/A
276.7
N/A
N/A
297.6
302.4
306.4
341.1
388.1
428.0
434.4
486.0
545.7
606.6
N/A
Difference
(X)
-27.8
-31.9
-25.2
-20.4
-19.5
-17.9
-20.7
-25.0
-22.9
-18.8
-8.7
-25.6
22.0
Region
Disaggregation
Procedure
Estimate
(Mil. $)
216.5
231.2
240.0
249.3
255.6
260.8
261.4
269.8
279.8
289.5
315.2
356.2
407.5
417.6
479.6
572.0
694.4
806.2
Difference
(*)
-20.0
-19.5
-22.5
-25.9
-26.3
-7.4
-16.4
-17.5
-13.9
-14.9
-11.2
-13.6
-21.2
-19.8
-17.7
-12.9
-35.0
-35.4
19.5
CO
o
-------
Wyoming Personal Income
(Billion Dollars)
- 31 -
H. L
4.0
3.8
3.6
3.4
3.2
3.0
2.8
2.6
2.4
2.2
2.0
1.8
1.6
1.4
1.2
1.0
.8
.6
.4
.2
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Output Techniques
' i
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1958 60 62 64 66 68 70 72
74
Figure 11. Personal Income in Wyoming, as Reported by the U.S. Depart-
ment of Commerce and Estimated by Input-Output Procedures, 1958-1975.
-------
- 32 -
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Personal Income (Million Dollars)
850
800
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.S. Dept. of Commerce :
Income Data*
ersonal Income by Input-
Output Techniques
arsonal Income by Disaggre- '',
gation Techniques \-
able for 1958, 1960, 1961, r
54, and 1975. t
1958 60 62 64 66 68 70 72 74
Figure 12. Personal Income in Northeast Wyoming, as Reported by
the U.S. Department of Commerce and Estimated by Input-Output
Procedures, 1958-1975.
-------
- 33 -
Phase I for the coal mining, coal fired thermal electric generating, petro-
leum and natural gas extraction, and petroleum refining sectors) provides
personal income estimates that coincide more closely with Department of
Commerce estimates than do those obtained with the earlier 13 sector model.
It appears that the input-output model can be used for estimating the
potential effects of coal resource development in North Dakota.
The model does not perform as well for northeastern Wyoming and
southeastern Montana as in North Dakota. It appears to provide estimates
that consistently underestimate personal income in Montana and Wyoming. The
downward bias of the estimates at the state level for the two states may be
partially due to the fact that the 17 sector model does not include some
sectors (such as metalic mining and forestry) for those states. Some of
the differences between input-output estimates of personal income and
Department of Commerce estimates for the study regions in the two states
may be due to an upward bias in Department of Commerce estimates. However,
procedures employed in this study to disaggregate state level personal
income yielded results that suggest that the upward bias in Department of
Commerce estimates is not great.
The fact the input-output model invariably underestimates personal
in Montana and Wyoming implies that the model leaves something to be
desired for describing the level of economic activity in those states.
However, the model does provide estimates that appear to "track" quite
consistently with Department of Commerce data, but with a predictable
downward bias. The rather constant downward bias in the historical com-
parison may allow the model to be used for impact analysis of coal resource
development in the two states. In other words, even though the model
-------
- 34 -
underestimates personal income throughout the historical comparison period,
year-to-year changes estimated by the model compare quite favorably with
those reported by the Department of Commerce.
RECOMMENDATIONS FOR FURTHER WORK
It is not recommended that work be initiated on Phase II at this
time. The reason is that some additional work similar to that envisioned
for Phase II will be conducted at North Dakota State University later in
1977. Part of this work includes modifying the input-output technical
coefficients with location coefficients (that reflect industry mix) for
the respective region in the three states. It is possible that the bias of
the input-output model (which appears to be related to population density
of the regions) may be reduced by this procedure.
Additional work is also scheduled under an agreement with the North
Dakota Regional Environmental Assessment Program (REAP). This will involve
expansion and refinement of the REAP Economic-Demographic Model. The results
of this work will provide measures of the reliability of the model for
projecting personal income, employment, and population (and also other
variables) in each of the eight regions in North Dakota. Since the inter-
dependence coefficients are an integral component of this model, that work
will contribute information regarding the usefulness of those coefficients
for evaluating impacts of coal resource development in North Dakota, Montana,
and Wyoming.
If the results of those efforts warrant it, further consideration
can be given to implementation of Phase III of this project.
-------
- 35 -
APPENDIX A
PROCEDURES AND DATA SOURCES FOR ESTIMATING
FINAL DEMAND VECTORS
The economic base for North Dakota and eastern Montana and Wyoming
consists almost entirely of receipts of 11 basic sectors. These sectors
are: agriculture, livestock; agriculture, crops; construction; wholesale
trade and agricultural processing; retail trade; business and personal
service; households; coal mining; thermal-electric generation; petroleum/
natural gas exploration/extraction; and petroleum refining. [The Standard
Industrial Classification (SIC) Code description for each of the 17 sectors
involved in the input-output model are presented in Table 1 of the report.]
The sectors included as final demand vectors in input-output analysis
are referred to as "basic sectors" because they constitute the economic base
of the area. Sales by these sectors typically are the sources of income
from outside the area that generate gross business volume, not only to the
basic sectors, but to the other trade and service sectors within the local
economy. These sectors are the ones through which income is injected into
the area as purchases of agricultural, mine, or manufactured products; by
the federal government for construction or for payrolls; and by tourist
expenditures to the retail trade or business and personal service sectors.
Data were collected for North Dakota, Montana, and Wyoming at the
state and county levels. County data were necessary because counties then
were grouped together to form regions. North Dakota State Regions 1, 2, 7,
and 8, nine southeastern Montana counties (Big Horn, Carter, Custer, Fallen,
Musselshell, Powder River, Rosebud, Treasure, and Yellowstone), and eight
counties in northeastern Wyoming (Campbell, Crook, Converse, Johnson,
Natrona, Niobrara, Sheridan, and Weston) were considered in the study. The
-------
- 36 -
sources of data for the three states came from identical or similar sources
and the methodology involved in calculating the sales for final demand for
the states were the same.
Agriculture. Livestock (Sector 1)
The data for agriculture, livestock consists of total receipts from
sales of livestock and livestock products. These data were published every
year from 1958 to 1975 at the county and state level for Montana, but only
at the state level for North Dakota2 and Wyoming. The Montana Region final
demand vector was obtained by adding livestock sales receipts in the nine
counties in the region. North Dakota and Wyoming livestock final demand
vectors were obtained by allocating state livestock receipts to the regions.
This was done by multiplying production at the county level by price for the
major livestock enterprises. The Allocator for the region was the share of
state total product that was accounted for by counties in the study
region.
Agriculture, Crops (Sector 2)
The total receipts and government payments for crops comprised the
agriculture, crops final demand vector. These data were published annua.Tly
4
for Montana at the county and state level, but only at the state level for
Montana Agricultural Statistics. Montana Department of Agriculture
cooperating with U.S. Department of Agriculture, Statistical Reporting Service,
Helena, Montana, December, 1962, 1964, 1968, 1970, 1974, and 1976.
2
North Dakota Crop and Livestock Statistics, North Dakota State University,
Agricultural Experiment Station, cooperating with U.S. Department of Agriculture,
Statistical Reporting Service, Fargo, North Dakota, May, 1960-1976.
Wyoming Agricultural Statistics, Wyoming Crop and Livestock Reporting
Service, issued by Wyoming Department of Agriculture, the University of Wyoming,
and U.S. Department of Agriculture, Statistical Reporting Service, Cheyenne,
Wyoming, 1960-1976.
4
Montana Agricultural Statistics, op. cit.
-------
37 -
North Dakota0 and Wyoming. The crops total receipts and the government
payments for each county in the region were added to obtain the region
final demand vector for Montana, The state crop receipts and government
payments were allocated to the regions for North Dakota and Wyoming in the
same method as were livestock receipts. The major crop enterprises were
used to allocate total crop receipts to the regions, then government pay-
ments were allocated to the regions in the same proportion that crop receipts
were allocated to each respective region.
Construction (Sector 4j
The construction industry generates dollar volumes basically in the
form of highway construction funded by federal government revenues. The
amount of federal expenditures for highway construction for North Dakota,
Montana, and Wyoming was available at the state level for the years 1958-
1968. The reporting procedure for these data changed in 1967 and actual
federal expenditures for North Dakota, Montana, and Wyoming were avail-
able at county and state level. Federal government outlays for construction
in the respective regions for the years 1958-1966 were estimated by allocating
state totals on the basis of regional shares reported for the years 1967-1975.
North Dakota Crop and Livestock Statistics, op_. cit.
6Wyoming Agricultural Statistics, o£. cit.
U.S. Treasury Department, Annual Report of the Secretary of the
Treasury on the State of the Finances, 1960-1968, U.S. Government Printing
Office, Washington, D.C.
Q
U.S. Department of Commerce, Federal Outlays in North Dakota, Office
of Economic Opportunity, National Technical Information Service, Washington,
D.C., 1967-1975.
g
U.S. Department of Commerce, Federal Outlays in Montana, Office of
Economic Opportunity, National Technical Information Service, Washington,
D.C., 1967-1975.
U.S. Department of Commerce, Federal Outlays in Wyoming, Office of
Economic Opportunity, National Technical Information Service, Washington,
D.C.. 1967-1975.
-------
38 -
Wholesale Trade and Agricultural Processing (Sector 7_)
Gross output of the wholesale and agricultural processing sector
consists principally of the value of miscellaneous manufacturing, much of
which is food processing. Also included are rather insignificant levels of
wholesaling activities, if that activity exceeds that of the benchmark
region (Region 8 in North Dakota). Several sources provided the data for
these estates.11'12'13-U'15
Retail (Sector 8)
Final demand vectors for the retail trade sector consist of three
fourths of the dollar volumes of tourism expenditures in the area. (The
other one-fourth is assumed to be to the Business and Personal Service
Sector.) North Dakota tourism receipts are estimated and published annually
at the state level. The business volume for tourism was allocated to the
regions on the basis of the region's share of state population. The assump-
tion was that areas with higher populations are more likely to possess the
services necessary to maintain a tourist trade.
New HealthNorth Dakota, Greater North Dakota Association, North
Dakota State Chamber of Commerce, North Dakota, 1958-1975.
12
U.S. Department of Commerce, Bureau of Economic Analysis, Personal
Income by Place of[Residence. Montana, Wyoming, Washington, D.C., 1976.
13
U.S. Department of Commerce, Census of Business: Wholesale Trade,
North Dakota. U.S. Government Printing Office, Washington, D.C., 1958, 1963,
1967, and 1972.
14
U.S. Department of Commerce, Census of Business: Wholesale Trade,
Montana. U.S. Government Printing Office, Washington, D.C., 1958, 1963, 1967,
and 1972.
U.S. Department of Commerce, Census of Business: Wholesale Trade.
Wyoming, U.S. Government Printing Office, Washington, D.C., 1958, 1963, 1967,
and 1972.
New WealthNorth Dakota, £p_. cit.
-------
- 39 -
The Travel Promotion Unit of the Montana Department of Highways made
tourism estimates for 1967 to 1972 for the state based on such items as gas
tax receipts, motel receipts, and number of cars counted by car counters.
Straight-line interpolation of the 1967 to 1972 data was used to estimate
Montana tourism for the 1973 to 1975 period. Using straight-line inter-
polation backward from the 1967 to 1972 data would have resulted in a very
small dollar amount of tourism expenditures for 1958. Because of the
similarities of Montana with North Dakota and Wyoming, such as geographic
attractions and respective locations, a percentage increase in tourism similar
to that of North Dakota and Wyoming for 1958 to 1966 was used for that time
period in Montana. The business volume of tourism allocated to the region
in Montana was on the basis of proportion of the state's population in that
region, which involved the same assumption as was made for North Dakota.
Data on tourism in Wyoming were very limited. The volume of tourism
18
was estimated for the state in a 1961 study at the University of Wyoming.
No other estimates were made until 1971 when the Family Research Institute
19
estimated tourism in the state. Straight-line interpolation was used to
make estimates of tourism for years not provided by the two studies. The
business volume of tourism allocated to the region in Wyoming was based on
the proportion of state population in the region.
17Montana Travel Industry, Montana Department of Highways, Travel
Promotion Unit, 1967-1972, Billings, Montana.
18Lund, Richard E., Study on Tourism in Wyoming, University of Wyoming,
Laramie, 1971.
19
Family Research Institute estimated based on 1971 data for article
in Better Homes and Gardens Magazine, 1972 edition.
-------
- 40 -
Business and Personal Service (Sector ]0)
After the dollar volume generated by tourism has been calculated and
allocated to retail trade, the remaining tourist expenditures (25 percent)
are treated as final demand to the business and personal service sector.
Households (Sector 12)
ie~Tederal government generates basic income to the household sector
through payrolls and transfer payments. Federal aid to states and individuals
is published annually for North Dakota, Montana, and Wyoming for 1968 to
1967.20 Defense expenditures, veteran's benefits, Old Age and Survivors'
Insurance payments, Workmen's Compensation, and the federal payroll are also
21
included as basic income. The household sector final demand vectors for
North Dakota, Montana, and Wyoming were calculated by adding total grants
(less highway construction), defense expenditures (except for construction),
veteran's benefits, Old Age and Survivors' Insurance, Workmen's Compensation,
and federal payrolls.
Total federal expenditures in the states were available on a county
basis for 1967 to. 1975 for North Dakota,22 Montana,23 and Wyoming.24 The
final demand vector for 1967 to 1975 Was calculated as follows: farm
payments (included as income in Sector 2), construction outlays, and loans
were subtracted from the total federal expenditures to obtain final demand
vectors at county and state level. The percentage the region was of the
20
U_._S. Treasury Department, op. cit.
21
U.S. Department of Commerce, Bureau of Economic Analysis, Personal
Income by Place of Residence, Montana. Wyoming, Washington, D.C., 1976"!
22
U.S. Department of Commerce, Federal Outlays ]n_ North Dakota, op. cit.
23 ' ' '
U.S. Department of Commerce, Federal Outlays i^ Montana^, op. cit.
24 ' '
U.S. Department of Commerce, Federal Outlays jj^ WyotTm^ o£. cit.
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- 41 -
state for 1967 to 1975 was used to allocate the household final demand vector
to the regions for the years 1958 to 1966.
Coal Mining (Sector 14)
The total receipts from sales of coal nonlocally comprised the coal
mining final demand vector. The production and value per ton were available
by mine for North Dakota for the years 1958 to 1975.25 All coal mined in SR 2
was assumed to be used domestically while in SR 8 all the coal from the Gascoyne
mine was assumed to be exported. Coal mined in SR 1 and SR 7 was assumed
to be exported in the same proportion as all North Dakota coal.
Production and average value per ton of coal was available by county
27
for Montana for the study years. All coal mined in the region was assumed
to be sold outside the region.
Wyoming coal production and average value per ton was available for
28
the study period on a county basis. Coal exported from Wyoming was assumed
29
to be total coal production less coal used for electric generation.
25
North Dakota State Mine Inspector, North Dakota Annual Coal Mine
Report, Workmen's Compensation Department, Bismarck, North Dakota, 1958 to
1975.
?fi
West, James G., unpublished memorandum to the National Energy
Considerations Work Group of Northern Great Plains Resources Program, U.S.
Department of the Interior, Washington, D.C., 1973.
27Minera1s Yearbook, Volumes I and II, Metals, Minerals, and Fuels.
U.S. Department of the Interior, Bureau of Mines, U.S. Government Printing
Office, Washington, D.C., 1958-1973.
28Ibid.
29Federal Power Commission, Steam-Electric Plant Construction Cost
and Annual Production Expenses, 22nd Annual Supplement - 1969.
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- 42 -
Thermal-Electrical Generation (Sector 1_5)
Sales of electricity outside the local region generated by burning
coal constituted the thermal-electrical generation final demand vector.
North Dakota thermal-electrical production was available for 1966 to 1975.
No coal fired electricity was available for export prior to 1966 in North
Dakota. All thermal electricity available for export in North Dakota was
produced in SR 7. Values were assigned to exported electricity to arrive
31
at the electric generation final demand vector.
Montana was assumed to have no thermal electricity available for export
because of its limited electrical generation facilities and is a net importer
32
of electricity.
33 34
Wyoming electrical production was available on a limited basis '
for the study years. The proportion of electricity exported was assigned
a value and considered to be the thermal electric generation final demand
35
vector for Wyoming.
Annual Report of the North Dakota Public Service Commission t£ the
Governor and Secretary of State, 75th, 76th, 77th, 78th, 79th, 80th, 81st,
82nd, 83rd, 84th, 85th Annual, Public Service Commission, Bismarck, North
Dakota, June, 1966, 1968, 1970, 1972, 1973, 1975.
Owen, WaJley, Public Service Commission, Bismarck, North Dakota,
interview estimates were made on basis of published reports by major
electricity producing companies.
30
Montana Dakota Utilities, telephone conversation, Bismarck, North
Dakota, February, 1976.
33
Wyoming Energy Consumption, Minerals. Fuels, Electric Generation.
and Agricultural Sectors, Bickert, Browne, Coddington, and Associates, Inc.,
Denver, Colorado, June, 1975.
34
Steam-Electric Plant Factors-1972. National Coal Association,
Washington, D.C., 1972.
Walker, David, Engineering Division, Wyoming Public Service Commission,
Cheyenne, Wyoming, telephone interview.
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- 43 -
Petroleum/Natural Gas Exploration/Extraction (Sector J_6)
Export sales of petroleum and natural gas from the local region con-
stituted the final demand vector for Sector 16. North Dakota crude oil pro-
duction was available by county for all years in the study period.36 Values
of the crude oil were assigned and export locations were determined to arrive
at the final demand vectors for the regions and North Dakota. North Dakota
is a net importer of natural gas so no final demand vector was calculated
for it.
Montana crude oil production was available for the years 1958 to 1975
by oil field. Prices were assigned to the crude petroleum38 and origin of
39
exports was used so the final demand vector could be calculated. Natural
gas production data also were available for Montana.40 Prices were assigned
41
to the natural gas and export locations determined. Montana was a net
importer of natural gas (from Canada and Wyoming) so no export sales were assumed,
Wilborne, Jack, North Dakota Geological Survey Data, University of
North Dakota Campus, Grand Forks, North Dakota.
Oil and Gas Conservation Commission of the State of Montana,
Statement of Crude Oil Production and Valuation, all Montana Fields, Oil,
and Gas Conservation Commission, Helena, Montana, 1958-1975.
38United States Average Wholesale Prices of Crude Oil and Petroleum,
Products in Eight Refining Markets, Prospective Regional Markets for CoaJ
Conversion Plant Products Projected ^o 1980 and 1985. prepared for Office
of Coal Research, U.S. Department of the Interior, by Energy Division,
Foster Associates, Inc., Washington, D.C., September 16, 1974.
39Lawson, Jim, Cenex Petroleum Refining, Glendive, Montana, telephone
interview; Mr. Peterson, Continental Oil Company, Montana, telephone interview.
40Montana Gas Production Data, Oil and Gas Conservation Commission,
Helena, Montana, 1958-1974.
41United States Average Wholesale Prices of Crude Oil and Petroleum,
op. cit.
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- 44 -
Wyoming crude oil and natural gas production data were available
44
by year for each oil and gas field. Values were assigned to the products
and export amounts and locations were determined to arrive at the petroleum/
natural gas by location/extraction final demand vector for Wyoming.
Petroleum Refining (Sector 17)
Export sales of refined petroleum products were calculated for the
petroleum refining final demand vector. North Dakota data were not readily
available but interviews provided data as to total petroleum products, export
destinations, and a refined product breakdown.46' 4 ' Values were
assigned to the exported refined products to estimate the final demand vector
49
for the petroleum refining sector in North Dakota.
42
Oil Production--Wyoming, by Producers and Fields, Wyoming Oil and
Gas Conservation Commission, Casper, Wyoming, 1958-1974.
43
Gas ProductionWyoming, by Producers and Fields, Wyoming Oil and
Gas Conservation Commission, Casper, Wyoming, 1958-1974.
44
United States Average Wholesale Prices of Crude Oil and Petroleum,
Wyoming Energy Consumption, Minerals, Fuels, Electric Generation,
op. cit.
45
and Agricultural Sectors, ojx cjt.
46
Feeny, Joe, Amoco Oil Company, Mandan, North Dakota, telephone
interview, he gave estimates on total production, exports, and breakdown
of refined products for 1958 to 1974.
47
Public Relations Department, Westland Oil Company, Williston, North
Dakota, telephone interview, he gave estimates of production, exports, and
breakdown of refined products for 1958 to 1974.
48
Mr. Thomas, Northland Oil Company, Dickinson, North Dakota, telephone
interview, he gave estimates of production, exports, and breakdown of
refined products for 1958 to 1974.
49
United States Average Wholesale Prices of Crude Oil and Petroleum,
op. cit.
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- 45 -
Montana data were available on petroleum refining by refinery for
the years 1958-1975. Prices were assigned to refined products51 and
CO
export amounts and locations determined so the petroleum refining final
demand vector could be calculated.
Wyoming data on crude petroleum oil refined were available for the
years 1958-1975. Values were assigned to the refined products54 and
r r EC
estimates of amounts exported were made ' so the final demand vector
could be calculated for the petroleum refining sector.
Oil and Gas Conservation Commission of the State of Montana, Barrels
of Crude Oil Refined in Montana, Oil and Gas Conservation Commission, Helena,
Montana.
51
United States Average Wholesale Prices of Crude Oil and Petroleum,
op. cit.
52
Lawson, Jim, Cenex Petroleum Refining, op. cit.
CO
Minerals Yearbook, Volume III, U.S. Department of the Interior,
Bureau of Mines, U.S. Government Printing Office, Washington, D.C., 1958-
1973.
United States Average Wholesale Prices of Crude Oil and Petroleum,
op. cit.
55Goodier, John, Chief, Mineral Development. Department of Economic Planni
and Development, Cheyenne, Wyoming, telephone interview, February, 1976.
56Wyoming Energy Consumption. Minerals, Fuels, Electric Generation, and_
Agricultural Sectors. OJD. cit.
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- 46 -
APPENDIX B
DISAGGREGATION OF PERSONAL INCOME
Personal income is perhaps the best criterion for determining the
accuracy with which an input-output model measures the level of economic
activity of the state or state region. Personal income reported by the
United States Department of Commerce may be compared to that estimated
by the input-output model at the state and substate level. However, the
personal incomes that are reported for the substate levels of aggregation
may be subject to significant errors of estimate. Therefore, an alternative
procedure was used to provide additional estimates of personal income at
the substate level. This procedure was developed prior to estimated levels
being published for substate areas.
The United States Department of Commerce annually publishes data
2
delineating total state personal income as the sum of six components.
These disaggregation techniques allocate each of the six components of per-
sonal income to its industrial and geographic origin. The allocator used
reflects economic activity similar to that which would generate a specific
component of personal income. Separate allocation techniques were used
for each of the six components: wage and salary payments, proprietor's
income, property income, other labor income, transfer payments, and
individual contributions for social insurance.
Senechal, D. M., Analysis of Validity of North^ Dakota_ Jjipj-
Models, unpublished M.S. thesis, Department of Agricultural Economics, North
Dakota State University, Fargo, 1971.
2
U.S. Department of Commerce, Bureau of Economic Analysis, Personal
Income by Place of Residence, intermediate table, Montana, North Dakota, and
Wyoming, 1976.
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- 47 -
Wage and Salary Payments
The allocator used to calculate each industry's wage and salary
payments among the counties was the portion of state total reported wage
and salary payments which occurred in a county. The data used to formulate
these allocators were based on United States Department of Commerce census
data. These census publications were published only at intervals so
straight-line interpolation was used to provide allocators for the intervening
years. Information for calculating agricultural crops and livestock allocators
was available for 1959, 1964, 1969, and 1974.3 Data for wholesale, retail,
and service sectors were available for 1958, 1963, 1967, and 1972.4' 5' 6
Wage and salary payments are not reported for mining, manufacturing, trans-
portation, construction, communications, and public utilities, finance-
insurance-real estate, and government sectors. State totals of wage and
salary payments in these sectors were allocated to the county level on the
basis of employment (weighted by average retail wage in the county) in each
sector in the respective counties in 1960 and 1970.
3U S Department of Commerce, Census^ of Agriculture, Montana, North
Dakota, and Wyoming, 1959, 1964, 1969, and 1974, Washington, D.C.
4U S Department of Commerce, Census, of Business,: Wholesale Trade,
Montana, North Dakota, and Wyoming, 1958, 1963, 1967, and 1972, Washington, D.C.
5U S Department of Commerce, Census of Business: Retail Trade,
Montana, North Dakota, and Wyoming, 15587T963, 1967, and 1972, WisTmTgton,
D.C.
6U.S. Department of Commerce, Census of Business: Selected Services,
Montana, North Dakota, and Wyoming, 1958, 1963, 1967, and 1972, Washington, D.C,
7U S. Department of Commerce, Census of Population, Montana, North
Dakota, and Wyoming, 1960 and 1970, Bureau of the Census, Washington, D.C.
-------
- 48 -
The annual average wage in retailing was obtained for each county
by dividing total county retail wages by the number of employees earning
these wages. Retail wages were used because they represent the most general
coverage of any wage average and because retail wages provide an indication
of differences among counties in wages and income.
Other Labor Income
Other labor income is composed of Workmen's Compensation payments,
employee benefits, military reserve pay, and several minor items. The
state total for other labor income was allocated to each county in the
same proportion as the total of wages and salaries received within the
county.
Proprietor's Income
Proprietor's income measures the net receipts of all nonincorporated
enterprises, including net income of farmers, professional persons, and
others in a self-employed status. A percentage ratio expressing the relation-
ship of a sector's total county sales to total state sales was computed.
The data needed for these computations were available for each year for both
o
crop and livestock production. County allocators for proprietor's income
o
Montana Agricultural Statistics, Montana Department of Agriculture
cooperating with U.S. Department of Agriculture, Statistical Reporting Ser-
vice, Helena, Montana, December, 1962, 1964, 1968, 1970, 1974, and 1976.
North Dakota Crop and Livestock Statistics, North Dakota State
University, Agricultural Experiment Station, cooperating with U.S. Depart-
ment of Agriculture, Statistical Reporting Service, Fargo, North Dakota
May, 1960-1976.
Wyoming Agricultural Statistics, Wyoming Crop and Livestock Reporting
Service, issued by Wyoming Department of Agriculture, the University of
Wyoming, and U.S. Department of Agricultural Statistical Reporting Service
Cheyenne, Wyoming, 1960-1976. '
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- 49 -
for the census years were calculated for wholesale, retail, and service
sectors. ' ' The wage and salary allocators for mining were used for
mining proprietorship allocators in each county. The same relationship was
assumed to exist between wage and salary disbursements in mining and proprietor-
ship income from mining in all counties. Straight-line interpolation again
provided allocations for noncensus years.
Total county proprietor's income was computed for the agriculture-
crops, agriculture-livestock, wholesale, retail, and service sectors. The
sum of county proprietor's income originating in these sectors was the
basis for formation of allocators for manufacturing, transportion, construc-
tion, communications and public utilities, and finance-insurance-real estate
sectors. The county allocator for each of these five sectors was the ratio
of county proprietor's income in the five reported sectors to state total
proprietor's income originating in their sectors. The assumption was that
income occurring to the unreported sectors would be proportional to the
level of activity in the reported sectors. The government sector has no
proprietor's income.
Property Income
Property income includes income received from dividends, rent, and
interest. The Department of Commerce does not categorize property income
by industrial source, but only by rent, interest, and dividends. Allocation
of property income was accomplished by the use of the same relationships
which were assumed for the disaggregation of proprietor's income.
g
U.S. Department of Commerce, Censuslof Business: Wholesale Trade,
op. rrt.
U.S. Department of Commerce, Census of Business: Retail Trade,
U.S. Department of Commerce, Census of Business: Selected Services,
OR. cvt.
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- 50 -
Transfer Payments
Transfer payments consist generally of disbursements from government
or business to individuals for which no services are rendered in that
specific time period. The federal government is the largest source of
transfer payments. The largest individual source of transfer payments is
social security benefits. Data on social security benefits were available
1 p
for the years 1967 through 1975. The county proportion of the state total
was used as the allocator. The 1967 allocator was assumed to hold for the
years 1958-1966.
Individual Contributions for Socia1 Insurance
Contributions made by individuals under the various social insurance
programs are excluded from personal income by treating them as an explicit
deduction item. The total state deduction for this category was subtracted
from each county's personal income in the same proportion that personal
income from the other five components was received.
U.S. Department of Commerce, Federal Outlays in Montana, North
Dakota, and Wyoming. Office of Economic Opportunity, National Technical
Information Service, Washington, D.C., 1967-1975.
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- 51 -
LIST OF TABLES
Table No. Page
1. ECONOMIC SECTORS OF INPUT-OUTPUT MODEL AND SIC CODE
NUMBERS OF EACH 6
2. INTERDEPENDENCE COEFFICIENTS FOR BASIC ECONOMIC SECTORS,
NORTH DAKOTA 7
3. SALES FOR FINAL DEMAND, BY ECONOMIC SECTOR, NORTH DAKOTA,
1958-1975 (MILLION DOLLARS) 8
4. PERSONAL INCOME, NORTH DAKOTA, 1958-1975 10
5. SALES FOR FINAL DEMAND, BY ECONOMIC SECTOR, NORTH DAKOTA
REGIONS, 1958-1975 (MILLION DOLLARS) 13
6. ESTIMATES OF PERSONAL INCOME AND DIFFERENCES IN ESTIMATES,
BY REGION, NORTH DAKOTA, 1958-1975 16
7. SALES FOR FINAL DEMAND, BY ECONOMIC SECTOR, MONTANA AND
SOUTHEASTERN MONTANA, 1958-1975 (MILLION DOLLARS) .... 23
8. ESTIMATES OF PERSONAL INCOME AND DIFFERENCES IN ESTIMATES,
MONTANA AND MONTANA REGION, 1958-1975 24
9. SALES FOR FINAL DEMAND, BY ECONOMIC SECTOR, WYOMING AND
NORTHEASTERN WYOMING, 1958-1975 (MILLION DOLLARS) .... 29
10. ESTIMATES OF PERSONAL INCOME AND DIFFERENCES IN ESTIMATES,
WYOMING AND WYOMING REGION, 1958-1975 30
LIST OF FIGURES
Figure No. Page
1. Personal Income in North Dakota, As Reported by the U.S.
Department of Commerce and Estimated by Input-Output
Procedures, 1958-1975 11
2. State Planning Regions in North Dakota 12
3. Personal Income in Region 1, North Dakota, as Reported by
U.S. Department of Commerce and as Estimated by Input-
Output Procedures and Disaggregation Techniques, 1958-
1975 17
4. Personal Income in Region 2, North Dakota, as Reported by
U.S. Department of Commerce and as Estimated by Input-
Output Procedures and Disaggregation Techniques, 1958-
1975 18
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- 52 -
LIST OF FIGURES (CONTINUED)
Figure No. Page
5. Personal Income in Region 7, North Dakota, as Reported
by U.S. Department of Commerce and as Estimated by Input-
Output Procedures and Disaggregation Techniques, 1958-
1975 19
6. Personal Income in Region 8, North Dakota, as Reported
by U.S. Department of Commerce and as Estimated by Input-
Output Procedures and Disaggregation Techniques, 1958-
1975 20
7. Montana and Nine-County Region in Southeastern Montana . 22
8. Personal Income in Montana, as Reported by the U.S.
Department of Commerce and Estimated by Input-Output
Procedures, 1958-1975 25
9. Personal Income in Southeast Montana as Reported by U.S.
Department of Commerce and as Estimated by Input-Output
Procedures and Disaggregation Techniques, 1958-1975 ... 26
10. Wyoming and Eight-County Region in Northeastern Wyoming . 27
11. Personal Income in Wyoming, as Reported by the U.S.
Department of Commerce and Estimated by Input-Output Pro-
cedures, 1958-1975 31
12. Personal Income in Northeast Wyoming, as Reported by the
U.S. Department of Commerce and Estimated by Input-Output
Procedures, 1958-1975 32
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TECHNICAL REPORT DATA
(Please read Instructions on the reverse before completing)
I H I- p o n i NO.
EPA-908/4-77-009
1. MILL AND SUBTITLE
Developinq Economic Impact Projection
Models for the Fort Union Coal Region
3. RECIPIENT'S ACCESSION NO
5. REPORT DATE
June 1977
6. PERFORMING ORGANIZATION CODE
7. AUTHOR(S)
Thor A. Hertsqaard
Randal C. Coon
F. Larry Leistritz
Norman L. Dalsted
8. PERFORMING ORGANIZATION REPORT NO
No. 77030
9. PERFORMING ORGANIZATION NAME AND ADDRESS
Department of Aqricultural Economics
North Dakota State University
Farqo, North Dakota 58102
10. PROGRAM ELEMENT NO.
11. CONTRACT/GRANT NO.
68-01-3507
12. SPONSORING AGENCY NAME AND ADDRESS
U.S. Environmental Protection Aqency
1860 Lincoln Street
Denver, Colorado 80295
13. TYPE OF REPORT AND PERIOD COVERED
Final
14. SPONSORING AGENCY CODE
EPA
15. SUPPLEMENTARY NOTES
16.ABSTRACT y^ reDOr't -js ^e initial phase of a study to develop, adapt, and intearate
models for evaluating the economic effects of expanded coal mining and conversion in
the Northern Great Plains (Fort Union) Reqion. Work under Phase I was desiqned to
determine the usefulness for describinq interindustry relationships in western North
Dakota, southeastern Montana, and northeastern Wyoming of input-output coefficients
previously developed for North Dakota. The 17 sector model (which includes coeffi-
cients collected in Phase I for the coal mining, coal fired thermal electric generat-
ing, petroleum and natural gas extraction, and petroleum refining sectors) provides
personal income estimates that coincide more closely with Department of Commerce
estimates than do those obtained with the earlier 13 sector model. It appears that
the input-output model can be used for estimating the potential effects of coal
resource development in North Dakota.
The model does not perform as well for northeastern Wyoming and southeastern
Montana as in North Dakota. The fact the input-output model invariably underestimates
personal income in Montana and Wyoming implies that the model leaves something to be
described for describing the level of economic activity in those states. However, the
model does provide estimates that appear to "track" quite consistently with Department
of Commerce data, but with a predictable downward bias. The rather constant downward
bias in the historical comparison may allow the model to be used for impact analysis of
O.
develop
17.
KEY WORDS AND DOCUMENT ANALYSIS
DESCRIPTORS
Economic Models
Economic Sectors
Population
Employment
Personal Income
Gross Business Volume
Final Demand Vectors
Interindustry Rela-
tionships
Input-Output Coeffi-
cients
Coal Mining
Coal Conversions
b.IDENTIFIERS/OPEN ENDED TERMS
COSATI Held/Group
13. DISTRIBUTION STATEMENT
Unlimited Distribution
19. SECURITY CLASS (This Report)
Unclassified
52
20. SECURITY CLASS (This page)
22 PRICE
EPA Form 2220-1 (9-73)
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