A comparison of economic impact assessment methods: the case of forestry developments in Alberta

Abstract

Economic impacts of forestry developments in Alberta are estimated using two interindustry approaches. The results suggest that estimates derived from input-output (I-O) models differ from those of computable general equilibrium (CGE) models. Employment and GDP estimates derived from CGE models are much smaller than those of I-O models. Unlike I-O estimates, estimates derived from CGE models are not unidirectional because of general equilibrium effects. The results also indicate that CGE models provide greater flexibility and have more potential for forest policy analysis when compared with I-O models, but they should be used with caution.