Abstract
ABSTRACT: The reduction of regional unemployment requires a sufficient demand for regional labor and the demand pattern must parallel that of supply. Due to the interdependency of Appalachian economy with the rest of the Nation, the leakage of the final demand imposed on a subregion of Appalachia is substantial. The more capital intensive the investment the higher the leakage which will lead to less demand for labor in Appalachia. While water resource projects are generally longterm projects which aim at structural changes in a regional economy, consumption expenditures induced by welfare payments or public employment programs are basically temporary measures for the rescue of unemployment. Average consumption and private investment programs may impose on Appalachia a larger material demand but the demand for the total regional labor, off‐site and on‐site combined, is estimated to be less than that from water resource investments. The public expenditure program for combating regional unemployment must be discretionary based on its purpose and its potential to generate optimum demand for labor which will be created by the pattern of regional resource distribution and interindustrial and interregional interactions. An interregional I/O model is best suited for analysis of this type.
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