Leakage, displacement, substitution and deadweight

A3.5 The effects of these types of intervention should be appraised for:

  leakage which is the extent to which effects "leak out" of a target area into others e.g. workers commuting into other areas to take up new employment opportunities

  displacement and diversion which is the extent to which an increase in economic activity promoted by an intervention is offset by reductions in economic activity elsewhere. This may be relevant if the objective of an intervention is to create new employment but it leads to existing businesses from other areas moving to a target area

  substitution where firms or consumers substitute one activity for another as a result of intervention

  deadweight which refers to outcomes that would have occurred without the intervention