CONSAD Research Corporation

National & Regional Economic Analysis

COMPARATIVE ANALYSIS OF ECONOMIC IMPACT PROJECTIONS DEVELOPED FOR A STANDARD SET OF POLICY SCENARIOS USING DIFFERENT MACROECONOMIC INTERINDUSTRY MODELING SYSTEMS

U.S. Department of Energy, Office of Economic Analysis and Competition

In this study, CONSAD performed a systematic comparison of the estimates of the economic impacts of a specific policy initiative that are produced by seven alternative macroeconomic interindustry modeling systems. Each modeling system was composed of a distinct combination of four components: a macroeconomic forecasting and simulation model, an input-output table describing interindustry purchases and sales of specific commodities, an analytic procedure for estimating the employment levels associated with any level and composition of industrial production, and a database for disaggregating from the national or regional level to the state level.

Comparisons of economic impact estimates were performed for three different scenarios corresponding to alternative sets of attribute values relating to the policy initiative. The data, expert judgments, and methods used and the results obtained in the study, including comparisons of the economic impacts estimated in all simulations conducted for each scenario, were documented in a comprehensive written report. The study found that a regional econometric modelling system produced superior results at the regional level with no significant information loss at the national level.