Microsoft Word 2007 ichrie conference Proceedings Final-Final 06-06-07. doc

Direct, Indirect, and Induced Effects 
The direct expenditure contributions of trading in goods and services generated by non-resident travel 
parties to the surrounding areas of a defined study region are one component of the economic impacts of visitation to 
a destination. Other economic impacts considered are indirect and induced effects. Indirect effects result from the 
suppliers of business and agencies that sell goods and services to the factories and organizations which directly 
provide their products to non-resident visitors. For example, restaurants purchased more vegetables to accommodate 
the increased number of non-resident visitors. Induced effects result from the direct and indirect effects generated by 
employee income in the defined region. For example, hotel employees spend their added wages or income in the 
surrounding counties along a regional destination for shopping, food, housing, transportation, and the daily goods 
and service needs.