The Economic Impact of 9/11 on the New York City Region

Abstract

Regional Economic Models Inc. (REMI) has developed this comprehensive study evaluating the economic impact of 9/11 on the air industry and the overall economy of New York City and the surrounding region. Using data inputs collected from a variety of sources and REMI's own Policy Insight model for the primary analysis, REMI is able to recreate economic interactions on a regional basis and simulate the economic impact of the events of 9/11. The report will quantify the economic impacts using various economic indicators, including employment, gross regional product, output, real disposable personal income, labor productivity, and population. These impacts are analyzed for New York City (separating Manhattan itself as one region and combining the four other boroughs of the city as another region) and nine other regions of the New York City Consolidated Metropolitan Area. The impacts are also shown for the rest of the USA and combined to show the results for the entire New York City Consolidated Metropolitan Area and the USA as a whole.REMI utilized their Policy Insight software to conduct this comprehensive analysis. REMI Policy Insight is a structural forecasting and policy analysis model. It integrates input-output, computable general equilibrium, econometric and economic geography methodologies. The model is dynamic, with forecasts and simulations generated on an annual basis and behavioral responses to wage, price, and other economic factors. The overall structure of the REMI model can be summarized in five major blocks: output and demand, labor and capital demand, population and labor force, wages, price, and cost, and market shares.