Teaching the Next Generation of Economic Modelers: Bringing IMPLAN Into Student Research

Many faculty members assume that integrating economic impact analysis into student research entails a steep learning curve for all participants. However, our recent webinar, Incorporating IMPLAN into Student Research, demonstrated that the process can be significantly more accessible. IMPLAN’s Academic Divisional Director, Bjorn Markeson, Ph.D., hosted Dr. Bridget Guerrero, the Paul Engler Professor of Agriculture at West Texas A&M University. Dr. Guerrero, who has utilized IMPLAN since 2003, has guided graduate students through diverse topics ranging from dairy economics to water policy. The following summarizes the approach she presented.

Begin with the research question before introducing analytical tools

Dr. Guerrero’s primary recommendation is to avoid introducing IMPLAN during the initial discussion. Students may become overwhelmed if the software is the primary focus, so she begins by emphasizing the research question. Key considerations include: What is the central question? What are the implications for the region? Why is the topic significant beyond the classroom context?

After establishing the research question, Dr. Guerrero introduces IMPLAN incrementally, following a progression she describes as walk, jog, run. Initially, students complete the training modules included with each IMPLAN subscription. Subsequently, they apply local data to execute a basic scenario from start to finish. This initial, comprehensive analysis often builds students’ confidence. Only after this stage do students proceed to their primary thesis projects, with faculty guidance available as needed.

Prioritize careful setup of the analysis

As students develop confidence, Dr. Guerrero increasingly delegates responsibility for constructing and executing the analysis to them. While she initially preferred to conduct the entire analysis herself, she now focuses her efforts on guiding key decisions that influence subsequent stages of the research.

The first critical decision is defining the study area. Redefining the region requires rebuilding the model, so it is essential to determine the appropriate boundaries at the outset, including nearby cities from which local businesses source inputs, to ensure accurate capture of economic leakage. The second decision involves selecting relevant sectors, with students guided through the rationale for each choice. The third focus is on interpreting results. Students are encouraged to assess whether the outcomes are logical, ensuring that direct effects align with model inputs and that they can explain output, value added, employment, and the distinctions among direct, indirect, and induced effects. This preparation is vital for addressing questions in academic settings.

Adapt the model to reflect regional characteristics

Dr. Guerrero observed that many users do not fully leverage the model’s capabilities at this stage. She emphasized that IMPLAN offers extensive customization, and the most robust research projects incorporate local knowledge to tailor the analysis.

In agricultural applications, customization often begins with spending patterns. While IMPLAN relies on national averages, Dr. Guerrero’s region has detailed crop and livestock budgets that her team incorporates into the model. This approach enables differentiation among specific crops, such as wheat, sorghum, and corn, rather than aggregating them under a general grain farming category. The team also adjusts regional purchase coefficients to reflect local purchasing behaviors, for example, in grain-deficit regions that source most grain locally. Additionally, they utilize the Excel template to streamline data importation.

This flexibility enables a wide range of student research projects. Students have modeled the dairy industry, confined animal feeding operations, compared conventional and regenerative agricultural practices, and analyzed water policy in the Texas Panhandle. One ongoing project examines whether business activity changes in counties experiencing declining Ogallala Aquifer levels. For broader water decline issues, the team integrates IMPLAN with an optimization model. When producers transition from irrigated corn to dryland cotton, these decisions are translated into monetary inputs in IMPLAN, and the resulting changes in economic multipliers are reflected in the regional analysis.

Develop a sustainable research program rather than isolated projects

Dr. Guerrero’s final recommendation concerns sustainability. Instead of requiring each student to start from scratch, she establishes a shared workflow that encompasses study areas, data sources, assumptions, and limitations. She introduces concepts in accessible language before presenting technical terminology. Students are required to document their IMPLAN procedures, often as a thesis appendix, enabling subsequent students to build upon previous work. Each student is also encouraged to contribute an original research question.

Dr. Guerrero illustrated the importance of student ownership with an example: when a student determined that available dairy data were insufficient, she proactively contacted local sources for improved data and investigated details that had previously been overlooked.

Addressing emerging or novel research topics

The question-and-answer session extended this theme to contemporary topics. When an attendee inquired about data centers, Bjorn Markeson, Ph.D., reiterated the importance of incorporating local knowledge. For rapidly evolving sectors, he recommended verifying that the production function, electricity mix, expenditure mix, and local purchasing structure accurately reflect the modeled scenario. Given the reliance on national averages and delays in benchmark surveys, this step is particularly critical. Customization can be achieved through a tailored production function or the Industry Impact Analysis Detailed option. Dr. Guerrero noted that she employed a similar strategy for ethanol plants during her graduate studies, modeling construction costs and ongoing operations separately. Markeson concluded that IMPLAN allows users to customize specific components while maintaining the overall analytical framework. Additional resources are available for those interested in data center analysis.

Integrate IMPLAN into academic instruction

Whether advising an initial student project or developing a comprehensive research program, Dr. Guerrero’s approach can be implemented incrementally. IMPLAN is also developing a student certification program that builds on the training modules from the “walk” stage, so learners can earn a credential to add to their LinkedIn profiles. For questions along the way, the IMPLAN Support site offers searchable answers on a wide range of IMPLAN functionality.  Additional resources are available to support academic users, including personalized demonstrations and the full webinar featuring Dr. Guerrero.