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be leakages.With each round of spending a portion usually leaks outside the local <br />economy.Leakages from successive rounds of spending eventually taper further <br />rounds of responding to zero.The larger the region,the more intricate the economic <br />linkages and,accordingly,the greater the total local impact from a given direct <br />expenditure. <br />There is,therefore,a multiplicativeeffect of a given direct impact,which results in <br />greater total impacts.This so-called multiplier reflects the extent to which the initial <br />expendituresrecirculate through a local economy.The multiplier shows the relationship <br />of direct impact to total impact and depends upon both the degree of linkages among <br />the local industries and the extent of leakages.In a general sense,the multipliercan be <br />estimated by dividing the total impact by the direct impact.For example,if a total impact <br />of $1000 is comprised of $500 of direct impacts,$275 of indirect impacts,and $225 of <br />induced impacts,the multiplier is $1000/$500 or 2.In this example,each dollar of direct <br />impact creates a total impact of $2.Note that the total impact includes the original dollar <br />of direct impact.To most accurately assess the multiplicativeeffect,estimates of the <br />multÍplierare often derived for each sector of the economy.To accomplish this task a <br />computer model of the local economy can simulate local economic interactions. <br />A number of economic impact analyses have been conducted for horse-related <br />activities.The primary element of impact analysis for horse parks is the measurement <br />of direct benefits.These are based upon a set of measurementsregarding the number <br />of people for every horse on the grounds,the expenditures per person,and the <br />percentage of expenditures that originate outside of the region of analysis.This last <br />component is included because,by the precepts of regional economics,it is assumed <br />that only external dollars advance the local or regional economy,since expenditures <br />from locals would have occurred anyway,whether on horses or on other items that <br />would cycle through the local economy.It is,accordingly,appropriate to review the <br />values of these spending patterns used in other impact analyses of horse parks.A <br />35