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<br />treatment of intra-regional trade. Arthur D. Little, Inc. constructed this <br />regional I/O model with three sectors, the northern High Plains (Nebraska, <br />Colorado and Kansas portions of the Ogallala), the southern High Plains (New <br />Mexico, Oklahoma, and Texas Ogallala), and "the rest of the world" [7J*. The <br />"rest of the world" includes non-Ogallala portions of the six states, the <br />rest of the U.S., and actual imports to and exports from the U.S. (including <br />High Plains agricultural products which are shipped overseas). The High <br />Plains was divided into two sectors for several reasons, including: <br /> <br />o Different climate and cropping patterns <br />o Different water supplies <br />o Dominance of the energy economy in the southern High Plains <br />o Existing regional trade flows <br /> <br />Data developed by each state I/O model is fed into the High Plains <br />regional model after appropriate adjustments for sectoral differences and <br />intra-regional trade flows. When the model is solved to balance final <br />demand, agricultural production, and levels of growth in the "rest of the <br />world" (from the INFORUM projections), the regional I/O model provides <br />projections for the two subregions for each study year of the same critical <br />economic variables projected in the state models, including: <br /> <br />o Output of each industrial sector <br />o Employment <br />o Total personal income <br />o Gross regional product (total value added, total sales) <br />o Population and per capita income <br /> <br />The differences in these values resulting from the raising or lowering <br />of water-induced constraints on agricultural production in each management <br />strategy are then calculated. The transaction table from each state which <br />are fed into the regional model are adjusted using the multiplier developed <br />in the Baseline I/O projections applied to changes in the farm production and <br />income sectors which are indicated by each water management strategy. <br /> <br />*See Figure 1. <br /> <br />A-16 <br />