The inflated impact studies we review tend to fail in the same few ways. The errors that recur, how to spot them, and why they matter.
The single most common error is treating all activity as new; a study that never asks what would have happened anyway credits the project with the whole economy.
The most common error is treating all activity as new. A project that pulls customers from other local businesses, or spending that residents would have done anyway, moves money around without growing the regional economy. A study that never asks what would have happened without the project counts the whole economy as if the project created it. In the studies we have reviewed, this single mistake shows up more than any other.
Closely related is presenting a contribution study, which describes activity that already exists, as an impact study, which estimates new activity a project creates. Both are legitimate tools for different questions, and a contribution number labeled as impact will look larger than the project's real effect. If the headline figure seems too big for the project, check whether this is the reason.
Every regional economy leaks. Money spent on equipment, inputs, and services from outside the area leaves quickly and does not multiply locally. A study that applies a big multiplier to the full project cost, without accounting for how much of the spending leaves the region, overstates the local benefit by a wide margin.
Construction is a one-time spike. Operations are the ongoing level a community actually lives with. A study that blends the two, or presents construction jobs as if they persist, describes a bigger permanent economy than the project supports. Honest studies keep them clearly separate.
The last error is false certainty: one big figure, no range, no assumptions, and no discussion of what could be wrong. Real economies move, and an honest study says so. A number presented with no uncertainty is the one most likely to embarrass whoever quotes it, and the one most worth a second set of eyes before it goes anywhere.
Have a study to check? Send it over. We will inventory every claim, attach the evidence, and tell you plainly what survives review and what does not.
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