TREIM

Ontario ’s Tourism Regional Economic Impact Model (TREIM)

Introduction

The Ontario Ministry of Tourism is providing this model (TREIM) on the web to make it easier for organizations and individuals working in, or interested about tourism to determine the economic impact of visitors’ and businesses’ spending in this area on the local and provincial economies.

What does TREIM do?

TREIM produces the following:

• Estimates of the Direct, Indirect and Induced impacts of tourism-related activities on Gross Domestic Product (GDP).
• Estimates of the Direct, Indirect and Induced impacts of tourism-related activities on Labour Income and Employment (Number of Jobs).
• Estimates of the Direct and Total impacts of tourism-related activities on Federal, Provincial and Municipal Tax Revenues.

TREIM is a versatile tool capable of providing detailed tourism-related economic impact analysis for various user-selected geographies. The user can currently chose from one of 49 Census Divisions in Ontario, 14 Census Metropolitan Areas / Census Agglomerations, 12 Travel Regions, or the entire province. The model can be used to estimate the economic impact of specific tourism events, the impacts of business operations by tourism industry sector, or the impact of capital project for the chosen region.

At its core, TREIM is a multi-region input-output model. TREIM differs from a standard input-output model in several respects. The first is its treatment of time. Input-output models are static – that is their results are independent of the date of the shock. TREIM, however, explicitly adjusts the model for changes in prices and labour productivity for the year chosen for the simulation. The model provides users with the ability to choose to conduct analysis for an event in the past, the present, or several years into the future. The impact results are reported in nominal dollars of the year in which the event takes place.

The second difference between TREIM and standard input-output models is its treatment of income earned by households and businesses. Direct and indirect activity by businesses provides income for workers and generates profits. The re-spending of this income yields what is referred to as the induced impact. Users can elect to either include or exclude the impact from household spending of their income or from business spending on new capital (as a result of higher profits). TREIM includes an econometric model to estimate these induced impacts that takes into account the state of the economy at the time of the shock in terms of interest rates, the exchange rate, inflation and economic growth.

The third major difference is TREIM’s estimates of government tax revenue. Standard input-output models only provide information on indirect tax revenues arising from sales and excise taxes (i.e. the GST and the PST). TREIM includes an econometric model that estimates the impact, by level of government, of all major taxes. 

"Please click here for the full document on TREIM's methodology".

What does TREIM require from the User?

To use TREIM, the user will be required to provide the following information:

General

• Report Title
• The Geographical Area where the activity takes place (All of Ontario, a Census Division, a Census Metropolitan Area, or a Travel Region)
• Additional Geographical Area of impact
• The impact Year (at the present time the model supports analysis for the years 1996 to 2007)
• “Yes/No” choice for Induced Impacts (Household Spending and Business Investment), and
• “Yes/No” choice for the inclusion of Property Taxes

Project Specific

Depending on the project, the User will also be asked to input data on visitor spending or on operating expenses or on investment. Depending on the amount of detail available, TREIM will provide options that the User can use to help him/her along.

Note: The model will retain none of the information provided by the User. All information inputted by the User will be deleted at the end of the session.

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