Crowding Out in New Orleans: Relief-Related Wage Effects on Investment?

The REMI Policy Insight model was applied to this study analyzing the appropriate level to which relief agencies should be involved in the rebuilding efforts of areas which have been affected by a natural disaster. The above-average wages paid by relief agencies in the wake of Hurricane Katrina in the New Orleans metro area were selected to highlight the potential for government to crowd out local businesses via employment in the short-term and investment in the long-term. Further analysis on the effect of wage increases on investment in New Orleans pre-Katrina, the extent of overall wage increases following the hurricane, and their estimated effects on employment and investment. Analysts determined that the government, through contracting with local and visiting businesses in the New Orleans metro area, paid high wages to workers involved in the cleanup and recovery, which, in turn, made it difficult for local businesses to compete. It appeared as though wages in the New Orleans metro area had increased more than what would be expected following a disaster of Katrina’s magnitude.

George Mason University – Crowding Out in New Orleans: Relief-Related Wage Effects on Investment? [full PDF]

Seeking Economic Sustainability: The Economic and Demographic Outlook for Michigan and Its Counties to 2035

The Institute for research on Labor, Employment, and the Economy at the University of Michigan used the REMI model to complete their forecasts for the Michigan Department of Transportation and this report summarized the procedures and broad results fro the most current outlook at the time. The forecasts were very detailed and were provided for each year through 2010 and in five-year intervals from 2010 through 2035 for population, employment, personal income, and households. The REMI model used in this study was an eighty-three county version, and the forecasts for each county were summed to the state forecast totals, with the model accounting for trade flows among the counties in the process. Employment was forecasted to continue to shrink, by 0.24 percent per year, from 2005 to 2010, but by 2010 employment was forecasted to rebound, growing more rapidly through 2015 and more slowly thereafter. This path translated into modest growth of 0.26 percent per year from 2010 to 2035, exceeding its 2000 peak employment level by 2022.

University of Michigan – Seeking Economic Sustainability: The Economic and Demographic Outlook for Michigan and Its Counties to 2035 [full PDF]

Environmental Tax Reform in California: Economic and Climate Impact of a Carbon Tax Swap

This study examined the economic, demographic, and climate impact of environmental tax reform in California through three separate carbon tax price points ($50/ton, $100/ton, $200/ton) and two scenarios aimed to return revenue without increasing spending. Those modeled scenarios are an “across-the-board” tax cut to income, sales, and corporation taxes and a “fee-and-dividend” approach paid out to households modeled on the Alaska Permanent Fund. These scenarios were run with a combination of the REMI PI+ model and the Carbon Tax Analysis Model and their synchronized efforts revealed that a “tax swap” could mean an additional 300,000 jobs by 2035, an extra $18 billion in GDP, an additional $16 billion in annual income, and carbon emissions at less than 75% of 1990 levels. A main factor considered by researchers was the need to improve environmental aspects of the region while leaving the competitiveness levels of Californian firms untouched.

Citizens Climate Lobby – Environmental Tax Reform in California: Economic and Climate Impact of a Carbon Tax Swap [full PDF]

The Economic, Demographic, and Climate Impact of Environmental Tax Reform in Washington and King County

Using a version of the PI+ model focused on the state of Washington and the Carbon Tax Analysis Model, REMI assessed if environmental tax reform could generate revenue, create jobs, help grow the economy, and reduce Washington’s carbon footprint. The way that the carbon tax specifications were modified for this study does not result in any major influence on the state’s cost of living or the distribution of income. Environmental tax reform has the potential to reduce the quantity of carbon emissions, improve the state’s attractiveness to migrants with more jobs and lower sales taxes, and increase its competitiveness through lower taxes.

Regional Economic Models, Inc. – The Economic, Demographic, and Climate Impact of Environmental Tax Reform in Washington and King County [full PDF]

Economic Effects of Health Care Reform on Virginia

This study estimated the impact of the 2010 health care reform law (the Patient Protection and Affordable Care Act/Health Care and Education Reconciliation Act) on Virginia’s economy. The law had been described as the most significant health care legislation since the passage of Medicare and Medicaid and was projected to expand health insurance coverage from an estimated 83 percent of U.S. legal residents in 2010 to 94 percent by 2019. The study utilized the REMI PI+ model to estimate the economic effects of health care reform and the modeling results indicated that health care reform had significant positive employment effects for Virginia. Relatively large budget surpluses in 2012-2014 represented a form of saving and a substantial leakage from the national economy that had a dampening effect on the overall economic impact results. However, once substantial program spending began, health care reform resulted in sustained impacts that peaked at 27,170 jobs in 2019.

University of Virginia – Economic Effects of Health Care Reform on Virginia [full PDF]