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Abstract
This paper investigates the impact of an expansion in agricultural processing on the
Western Australian economy by modifying and applying a Computable General Equilibrium
(CGE) economic model of Western Australia (called WAM). WAM was used to simulate the
effects of a $1 million expansion in eight agricultural processing industries. The results show
that there is a range of positive impacts from agricultural processing. On average, a $1
million expansion in agricultural processing is estimated to increase the State’s GSP (Gross
State Product) by $649,000, and total output by $1.9 million. The expansion of the Wine and
spirits industry is estimated to have the largest impact while the Textile fibres, yarns and
woven fabrics industry has the smallest impact on the Western Australian economy.