The economic impact of military installations on regional economies

Abstract

This thesis determined that a model could be developed to forecast the impact of the closure or restructure of a military installation on a regional economy. The closure of a military base can have a significant effect on a community, and the impacts are required by the National Environmental Protection Act to be estimated before legislative action can be passed. The research examined the theories of economic impact and multiplier effects. The principles of shift share analysis were further investigated and applied to the industries of the national and Monterey County economies. An average employment multiplier was derived and used in the development of an alternative economic impact forecast model. The research also applied other commercially available economic impact forecast models to the data associated with the base closure at Fort Ord, California, and the forcasts agreed that the county economy would suffer considerably in the short term. The selected model was then applied to two redevelopment options and the results predicted that the county economy would improve greatly in the long term after the initial slump.