Calculator Methodology

Overview Calculator | Food Calculator | Financial Calculator

Overview Calculator

The Overview Calculator uses the US Census Bureau's inventory of businesses with employees. All businesses are indexed in 1,100 NAICS categories of industries (NAICS stands for the North American Industrial Classification System, more information available here, definitions here). Much of the data utilized is from the 2007 Economic Census, which represents a comprehensive survey of American businesses.

Here are some important issues to keep in mind: 

100% Issue and Underestimation of Opportunities

If the number generated for self-reliance is above 100%, the calculator assumes there is no opportunity for import substitution. But this isn't necessarily true. If a given commodity is exported at a rate far greater than the national average, a community may look self reliant but still be importing in great amounts. For example, if a community has multiple factories producing enough applesauce for the entire population, but only 20% of the product is consumed locally, with 80% being exported, from a production standpoint it looks like the community is self-reliant (production is 100% of local needs). But because 80% is being exported, the community is actually only 20% self-reliant, with great opportunities for import-replacement. So, when it comes to results showing 100%, the calculator may actually be giving a wild underestimate of the real import substitution potential.

Practical considerations, and the need for local knowledge.

Some forms of economic activity (i.e., some NAICS categories) may not be practical for a given region. This is especially true for industries dependent on natural resources, like shellfish (Colorado will likely never get into shellfish production) or mining (not all areas have shale reserves). However, the calculator returns results in these areas to show how mining or shellfish production could be further localized.  Another example is that the calculator might show that poultry production could be 100% localized (currently 0% self reliant), but the legislation in that particular zip code or county might prohibit poultry production.

In these cases, a data end-user will have to apply basic interpretation. A human being who knows the region well needs to review the results and make the call regarding whether trying to localize a given industry is a wise investment.

New jobs and new earnings columns are based on 100% self reliance. If you want results for 25% self-reliance, you'll have to do additional (simple) calculations with the calculator results.

New jobs and new earnings assume a community wants to reach 100% self reliance. But if you only want to see what jobs and income could be generated by go 25% toward import substitution, you'll have to divide the calculator's New Jobs and New Earnings numbers by 4.

We don't have consumption and production data at the local level for the overview calculator.

Our results are not based on consumption and production at the local level. The overview calculator data is based on census information about jobs in each county and zip code. We start with calculations looking at production and consumption in each sector at the national level, and then apply these averages by geography/population size in order to get county and zip code results for % Self-Reliance, New Jobs and New Earnings.

There is a discrepancy between 6-digit and 2-digit results.

The database for the 2-digit returns is a different data set than for the 6-digit returns. As a result, almost always, the 6-digit returns will show you higher opportunities for import substitution in terms of new jobs and new earnings. Neither set of results is right or wrong, they represent different possible outcomes from utilizing databases with different levels of detail.

Problems with NAICS data.

NAICS does not have farmer data, or public employee data, or self-employment data (with a couple of minor exceptions for public-private partnerships, etc).

For example, when you get to educational resources, it's only going to show private education or non-profit colleges and universities. Public universities won't show up in the results, as those employees are state (i.e., public) employees.

The good news is that NAICS is committed to fixing those holes over next few years. The bad news is that, for now, the calculators don't include farmer data and self-employment data.

Food Calculator

The information used in the Food Calculator, is primarily drawn from the 2007 Agricultural Census. The most convenient tool for querying the Agricultural Census data is Quick Stats, a service of the USDA NASS.

The Agriculture Census sometimes withholds information to avoid disclosing data for individual farms, in which case “No Data Available” will appear in results. In contrast, an output of “$0” means that no farms in your region reported sales of that product. If you see "$0" for Hogs & Pigs but you know there is a fellow raising hogs down the street, it's possible that he wasn't around three years ago, or failed to report data for the Agricultural Census.

% Self-Reliant

While local level production data has been added to the Food Calculator, consumption data is based on average per capita data at the national level. The "% Self-Reliant" is calculated by taking demand (represented by per capita data on consumption), and multiplying by population, and comparing that number to total production reported in the area selected.

Take Baxter County, Arkansas.  With a population of 41,695, they consume approximately $2,000,000 of vegetables. If Baxter County only produces $34,000 of fresh vegetables then they are 1.07% self-reliant. This means that the county imports approximately 98.3% of all vegetables consumed.

Business Opportunity

While local level production data has been added to the Food Calculator, consumption data is based on average per capita at the national level. The "Business Opportunity" is calculated by taking demand (represented by per capita data on consumption), and multiplying by population.

While “% Self-Reliant” is calculated for a county or state as a whole, “Business Opportunity” is computed based on data from each zip code in that region. So, the state of California is 950.74% self-reliant in fruit production, but also has a business opportunity of 447,694 acres of fruit. This means that if all the counties in California were to become completely self-reliant, there would be opportunities spread throughout the state for 447,694 acres of fruit. The reason why self-reliance is at 950.74% meanwhile, is that in certain counties fruit is being grown in massive quantities for export.

The "Business Opportunity" is given in lbs. of vegetables and in animals. While we used dollars in calculating self-reliance, it makes sense to present business opportunities in more concrete forms. To find out how we turned dollars into animals and vegetables commodities download this file.

Finance Calculator

The calculator uses national data on Americans' investing and savings trends, and utilizes population information from the Census Bureau to approximate the value of residents' financial resources. Because these estimates are based on national data, depending on the constituency of your region, the financial resources of your county may be more limited or more vast than the results indicate.

Where's my Local Bank?

As discussed, only local banks are displayed in the Financial Calculator. Its branches and locations, and its total deposits and assets, as recorded by the FDIC, are included. Credit Union data comes from the National Credit Union Administration and includes branch locations, deposits in each branch and total assets.

Right now, the BALLE Financial Calculator considers a bank or a credit union "local" only if it operates intrastate and is independently owned (that is, not owned by a holding company). If you notice that your local bank is not included in these results, take a moment to check if the bank is owned by a holding company. Go to Institutions and enter the name or FDIC# of the bank. If your bank is not owned by a holding company, or if you believe the holding company is locally-owned, please contact us with the area for which you submitted a query (i.e. Larimer County) and the FDIC# of the bank.

In version 1.1 of this calculator, which will be available in early 2011, we will undertake a more nuanced sorting of financial institutions. Until then we request you contact us if the results omit a locally-owned bank or credit union in your area. We will use your local knowledge to refine these results and improve our listings.

 If your questions was not addressed here, please feel free to contact us directly.