In order to better and more precisely understand the range of full aggregate economic impacts—including the various multipliers and interrelationships—the Commission has authorized the development of a comprehensive regional economic model.[1] The model is designed to be a framework for analyzing potential economic impacts at the regional level in states affected by the price regulation, and is being programmed to generate four different scenarios rather than a single economic impact assessment.
This framework approach reflects the presence of outstanding questions about the price regulation’s actual impact, such as the actual amount of the pass-through of the over-order obligation to consumers. It will also allow the analysis to be tailored to reflect future changes in provisions of the price regulation, if such changes occur.
The results of this work will be posted on the Commission’s web site as they become available over the next few weeks and months.
[1] The model is being developed by Regional Economic Models, Inc. (REMI) and Thomas E. Kavet of Economic and information Systems Consulting