Economic impacts refer to the effects on the level of economic activity in a given area, as result of some form of external intervention in the economy. The intervention can be in the form of new investment in for example, transport facilities, social developments, housing, business development, etc. The economic effects may be viewed in terms of:

1.job creation 2.business output (or sales volume),
3.value added (or gross regional product), 4.wealth (including property values), or 5.personal income (including wages). o revenue flow and taxes

Any of these measures can be an indicator of improvement in the economic well-being of residents, which is usually the major goal of capital investment projects.

Economic impacts also lead to fiscal impacts, which are changes in government revenues and expenditures. Economic impacts on total business sales, wealth or personal income can affect government revenues by expanding or contracting the tax base. Impacts on employment and associated population levels can affect government expenditures by changing demand for public services.

The following impacts can usually be quantified:

Direct impact: The direct impact is calculated from macro-economic aggregates occurring as a direct result of the project. The initial impact on GDP, for example is taken from the financial information and equals the value added generated by a specific scenario.

Indirect impact: Indirect impacts are calculated from the activities of suppliers through application of the model. For purposes of this study, indirect suppliers include those industries who deliver goods and services to the activity under discussion (first round suppliers) including suppliers who on their part deliver goods and services to the first mentioned indirect suppliers

Induced impacts: The induced impacts are the impacts on goods and services demanded due to increased expenditure by households from income earned due at the project. Examples include the income of employees and shareholders of the project, as well as the income arising through the backward linkages of this spending in the economy. The impact is sometimes confused with the forward linkage of a project.

This means that results will be compared in terms of the various types of impacts and how these can be offset by the increased revenues, incomes and labour remuneration. These are indicative of the viability of the projects. All the factors that will have an impact on ensuring that the communities are better off after the development of he project than before will be assessed. This includes the negative (disbenefits) as well as the positive (benefits) impacts of the proposed projects.

A change in the local economy can be effectively simulated by the I/O technique to identify and quantify the various impacts of such a change in regional and national context.

It is important to understand that each local area is an open economic system with strong linkages with surrounding economies, representing interaction across boundaries. This brings to the fore the following concepts:

• 
  Leakages: net outflow of buying power i.e. households residing within the study but purchasing goods and services outside the study area.

• Injections: refer to the reverse of leakages; i.e. businesses located outside the study area but pretrasing inputs/products inside the study area.

IMPACT ANALYSIS: PROJECTS

The economic and socio-economic impacts of major investment and infrastructure projects such as mixed-use developments, airports, casino developments, mining investments, etc. can be determined. Economic modelling techniques, such as the multiplier analysis, are usually applied in determining the impacts of projects and proposed investments. The results of the analysis are utilised substantially in motivating the project to all levels of government.

Impact of World Summit Parallel Events: Urban-Econ has been appointed to determine the economic impact of 500 parallel events to the World Summit and on sustainable Development on the economy and communities by utilising an impact simulation model that quantifies the direct and spin-off effects of the investment leading up to the events, as well as increased economic activities and financial injections due to the events itself expressed.

Tourism Promotion and Development Planning (TPDP) Impact Assessment: Urban-Econ was appointed to obtain detailed information of the impacts of Tourism developments in four focus areas (Western Cape, North West, Mpumalanga and Limpopo) based on tourism demand, socio-economic capacity of communities and inherent development potential. This required that tourism market potential needs to be translated into conceptual frameworks for each area, reproducing the basis for the impact assessment in terms of Economic impact, Social impact, Job creation, Tourism market penetration potential and sustainability of linkages and independency capacity especially in terms of funding.

Impact of Poverty relief projects: Urban-Econ was appointed to undertake primary and secondary research to quantify and qualify the economic and welfare impacts of six poverty relief case study projects funded by poverty relief funding to address the sustainability of projects and potential for independent operation.

JDA Kliptown, Newtown and Constitution Hill: Urban-Econ was appointed as economic consultants for the 10 key strategic projects developed by the Johannesburg Development Agency. The main function is to determine the economic impact of these projects on Johannesburg and Gauteng. More specifically the following are, at present, being executed:
- Compiling strategic business plans for three JDA projects, namely Kliptown Urban Renewal, Newtown Cultural Precinct and Constitution Hill Development, as part of the 8-I Strategic Project Planning process of Blue IQ;
- A cluster-analysis to determine future supportive creative industries that can be located in Newtown;
- Formulation an integrated tourism strategy for the JDA projects;
- Conducting a business audit and developing strategic guidelines for Braamfontein Development Projects;
- Economic interpretation, property market analysis and economic impact assessment of the Constitution Hill Master Plan and compiling a development strategy for the precinct;
- Economic input into the Kliptown Development Framework.

Gautrain: Urban-Econ is currently involved with one of the major SDI projects in Gauteng, namely the so-called Gauteng Fast Train. Urban-Econ is responsible for modelling the economic and socio-economic inputs of the train and the location of stations. The model that has been developed by Urban-Econ can be manipulated to simulate impacts in terms of employment, productions and other economic indicators.
Braamhoek Pumped Storage Scheme Impact Analysis: Urban-Econ was part of a team to determine the environmental, economic and social impacts of a proposed storage scheme. Surveys were conducted to incorporate local circumstances into the study and to identify potential impacts.

Iscor Steel: Analysed the significance of South Africa's steel giant in the domestic economy and modeling the socio-economic impact of the company's re-engineering exercise on the regional and national economy.
Silver Star Casino: Analysed the tourism, economic and social impacts of developing a casino in Krugersdorp as part of an application for a gambling license.

Vaal River Mine: Prepared economic, social and land use inputs for Environmental Lawyers regarding Sasol's plans to develop a mine on the banks of the Vaal River near Sasolburg.

Kensington golf course: Determined the economic impact of the proposed mixed use development located on the former Kensington Golf Course.

Mondi Site Disposal Options: Investigate the potential net income that can be generated by means of a spectrum of site disposal options. Apply techniques such as capitalisng net annual income into perpetuity to determine the net present value of the site.

Iscor Flat Products: Socio-economic Impact Assessment of different disinvestment options: Assess the direct, indirect and induced impact of Iscor's Operation Excellence (OP-ex) on the local, provincial and national economy in terms of production, employment, impacts, company taxation, personal income tax, value added tax and other indirect taxes.

South African Broadcasting Industry: Economic Modeling: Urban-Econ was appointed by the Department of Communication to identify and analyse several key policy options within the broadcasting industry in respect of the determination of the preferred pace of licensing, the maximum contribution of the industry to meet national policy objectives and the optimisation of the commercial value broadcasting assets. The project entailed, inter alia, the compilation of an economic model on the industry and the impact of several scenarios on the model.

National Waste Discharge Charge System: Urban-Econ is currently acting as project leaders to investigate and formulate a STRATEGY, which addressed the introduction of a waste discharge charge system (WDCS) in South Africa. The system of waster discharge charges would augment the pricing strategy for raw water use charges provided for in the National Water Act, 1998 (Act 36 of 1998).

Salinisation in the Middle Vaal River: Acted as lead consultant with respect to the extensive investigation into the economic impact of salinisation in the Middle Vaal River system. Input-output and multiplier analyses have been extensively used in modelling the effects of saline water on the economy.

Mutale and Nwanedzi River Basins Water Resource Investigation: This study is aimed at assessing the possible impact the construction of dams proposed in the Mutale river basin, and the effect on an increase in the height of the Nwanedzi dam on the local economy and population. Aspects such as socio-economics status and cultural-historic places of significance were considered.

Job Creation in the Construction Industry: The purpose of this study conducted for the Department of Housing (National) had been the creation of a comprehensive economic model that simulates the job creation ability of the construction industry in South Africa. An important outcome of the model is the formulation of job creation indicators, generally acceptable to the housing fraternity, inclusive of the private sector.
Ingwe Mines Delmas Coliery environmental impact analysis: A socio-economic impact assessment was to be undertaken whereby the identified issues were evaluated in terms of potential benefits or disbenefits interested and affected parties and study area. The most important impacts that were determined referred to the positive benefits accruing to the community.

Economic Value of Water: Urban-Econ was appointed as lead consultant to determine the economic value of water for the Department of Water Affairs by means of applying economic modelling techniques. This study was part of the Vaal River system analysis.

Thabazimbi/Northam Study: Urban-Econ undertook a major exercise to determine the potential of industrial development consequent upon major mining developments in the Thabazimbi/Northam region, Northern Transvaal.

Klein and Middle Letaba Reconnaissance Study: The objective is to establish and compare the supply and demand for water for the various end-uses, based on which scenario's can be generated to test the implication should the supply of water to those economic activities that currently constitute the core of the local economic base be reduced tin future as a result of a significant increase in the requirements for primary consumption. Should possible dam sites be identified, their impact is determined in terms of the number of people to be located, ecological considerations, cultural-historical consequences (e.g. the flooding of burial grounds) and the compensation of the local population for land and improvements (e.g. houses).

Internet Broadcasting: Urban-Econ formed pat of a consortium appointed to develop a discussion document on Internet Broadcasting, for the purpose of establishing a policy framework for this industry in South Africa. This project entails the identification of technical alternatives for the implementation of Internet Broadcasting, determining the backward and forward economic linkages, the assessment of the market demand, as well as the development of a simulation model

Feasibility Study to Augment the Eastern Vaal Sub-system: The purpose of the study is to re-evaluate the need for augmentation of the Eastern Section of the Vaal River System in view of changes in the water requirements and thereafter determine the most feasible option to augment the water supply. Water demand curves were developed for low, probable and high scenario analyses and utilised as a basis to evaluate specific schemes for the augmentation as confirmed in terms of quantity and time span.

Thesen Island: The purpose of this study is to determine the economic impact of the redevelopment of Thesen Island on the economy of Knysna in terms of the additional GGP and employment generated as well as the impact on the local tax base.

Arabella Golf Estate: Economic Impact Assessment (2001 & 2002): The essential purpose of this study was to assess the impact of the development of the Arabella Golf Estate on the economy in terms of the development role of a biosphere reserve. Urban-Econ achieved this by developing an impact analysis model to determine the economic impact of the development and to assess this impact in terms of the local economy. In 2002 Urban-Econ was asked to update the model as the Arabella Golf Estate extended the original proposal.

Culemborg Casino Complex: Urban-Econ was part of a multinational and -disciplinary team to motivate a casino license application. The economic research entailed conducting an economic impact analysis of the proposed development to determine the economic and socio-economic benefits to the Western Cape economy.
K16 Route Alignment: This project entailed the identification and evaluation of different route alternatives for the K16 road in Pretoria. This route will form an important transport corridor as a development spine, with significant implications for business development and investment.

Franschhoek Country Estate: Economic Feasibility Study (2002): Urban Econ was appointed by the Franschhoek Empowerment and Development Initiative to test the feasibility of a number of land uses including: a hotel and wellness centre, agricultural land, commercial and retail centre, culinary school and exhibition and conference centre. Once the feasibility for these land uses were analysed, a impact assessment was completed to determine the impact that such a development would have on the economy.

K16 Impact Modelling: The compilation of a suitable economic impact model to determine the influence of the proposed K16 Corridor on the economy of Pretoria. The impact analysis was done by means of an Input/Output model, used to determine the impact on capital investment, direct economic development urban markets.

Nqutu Regional Water Supply: URBAN-ECON serves as development economist on the team of consultants investigating the provision of bulk water supply in the Nqutu district of KwaZulu-Natal. As such URBAN-ECON is responsible for compiling the Economic Model for the project in terms of which a cost-benefit analysis will be undertaken.

K-8 Impact Assessment: Urban-Econ undertook a modelling exercise for the K-8 Route and for this purpose an economic impact modelling technique has been developed:. This model is applied to objectively quantify the potential impact in economic terms and translate these in terms of financial and social effects.

The Impact of HIV/AIDS on the demand for low-cost housing and policy implications thereof: Funded by the Joint Centre for Political and Economic Studies and the National Department of Housing. This study currently being undertaken examines the impact of HIV/AIDS on the size and type of demand for low-cost housing. The study includes 2 500 surveys in the 9 provinces of South Africa to determine current household/socio-economic conditions and the influence of HIV/AIDS on the household composition and size. Furthermore, the study strives to provide analytical policy response to the needs of HIV/AIDS infected and affected households. The result of the study will culminate in recommendations that will be presented to the national Department of Housing.

Gauteng CMIP: Urban-Econ forms part of the CMIP Backlog consortium established for the purpose of investigating the current infrastructure backlog in Gauteng in terms of the government's CMIP programme. This includes the impact modelling of future infrastructure projects in the various areas in Gauteng.