Center for Economic Analysis

Factors contributing to consumers' preferences for local foods span many interests, but for local policy makers, interest is focused primarily on the potential of local food systems to support the local economy and local jobs. To this extent, an expansion of local sales constitutes import substitution, where local foods supplant existing imports. This study uses the IMPLAN modeling system and the associated technical coefficients for the broader food shed surrounding and including the Chicago Metropolitan Area as the region and data source for analysis. The study compares the approaches to measuring the economic value of local food systems described in Miller, Mann et al. (2015) and Watson, Kay et al. (2015). The prior provides a " follow the money " approach to estimating the direct effects of food‐ related production that remains in the modeling region. The latter approach provides a mathematically elegant approach for isolating the total contributions of local food systems, but cannot separate out the direct effects. Considerations of the roles of important coefficients are introduced (Jensen and West 1980, Miller and Blair 2009 pp. 567). We show complementarities in these approaches.