The 2006 Norfolk Island Economic And Product Market Databook

In performing various economic analyses for its clients, I have occasionally been asked to investigate the market potential for various products and services in Norfolk Island. The purpose of the studies is to understand the density of demand within Norfolk Island and the extent to which Norfolk Island might be used as a point of distribution within Oceana. From an economic perspective, however, Norfolk Island does not represent a population within rigid geographical boundaries, rather, it represents an area of dominant influence over markets in adjacent areas. This influence varies from one industry to another, but also from one period of time to another. In what follows, I summarize the economic potential for Norfolk Island over the next five years for hundreds of industries, categories and products. The goal of this report is to report my findings on the real economic potential, or what an economist calls the latent demand, represented by Norfolk Island when defined as an area of dominant influence. The reader needs to realize that latent demand may or may not represent real sales. For many items, latent demand is clearly observable in sales, as in the case for food or housing items. Consider, however, the category satellite launch vehicles. Clearly, there are no launch pads in Norfolk Island used by the space industry to launch satellites. However, the core benefit of the vehicles (e.g. telecommunications, etc.) is consumed by the area served by Norfolk Island. Without Norfolk Island, in other words, the market for satellite launch vehicles would be lower for the population in Norfolk Island, Oceana, or the world in general. One needs to allocate, therefore, a portion of the worldwide economic demand for launch vehicles to both Oceana and Norfolk Island. The data presented are the result of various spatial econometric and time-series forecasting models which, for each category presented, are applied to forecast and allocate latent demand across all count