Direct Effect
Contents
Definition
Direct Effect denotes is the first round impact of changes in Final Demand as modeled by an Input-Output Model
Usage
The gross output multiplier measures the total economy-wide induced/indirect gross output of all other industries/businesses in the economy in relation to the company’s gross output.
The gross value-added multiplier measures the ratio of the total economy-wide induced/indirect gross value of all other businesses/industries in the economy to the company’s gross value-added output.
The labour Income Multiplier measures the ratio of the total economy-wide induced/indirect labour income of all industries/businesses in the economy to the company’s labour income.
The tax and social contribution multipliers, respectively, measure the total economy-wide indirect/induced taxes and social-security contributions from all industries in the economy in relation to the company’s gross output.
The employment multiplier measures the ratio of the total economy-wide indirect/induced employment of all industries in the economy to satisfy a one-unit increase in the company’s total employment.
