The value of China Lake as an economic driver for the town of China is widely known, but a new study by a Colby College economics team shows that impact extends to the greater China Lake Watershed as well.

Full Study

China Lake Association asked Professor Michael Donihue, director of the Colby Laboratory for Economic Studies, to focus the lab’s attention on the China Lake Watershed, which extends from the lake into, not only China, but parts of Vassalboro, Albion, and Winslow.

The team’s research, which was released in May, shows:

• Homes inside the watershed on average sold for 16 percent more than comparable properties outside the watershed.

• Population grew by 2.4 percent during the decade 2012-2022, with most of the growth in proximity to China Lake.

• During that same decade the median household income in China doubled.

• More than 60 percent of the town’s population lives in the China Lake Watershed.

  
  

• Earnings paid by firms in the Town of China contributed more than $71 million to economic activity in Kennebec County in 2022 alone, nearly 10 percent of the County’s total of 8 billion.

The Colby study coincided with a University of Maine economic impact report that concluded Maine lakes are worth $14 billion, with contributions coming from everything from the value of lakefront properties, to sales of gas and meals, to the value of drinking water.

At Colby, Donihue and his economics team have done work relating to the Belgrade Lakes Watershed, including a study of the economic impact of seasonal visitors there. The economics group also has been part of a larger multi-year examination of the impact of landscape and lake-ecosystem changes resulting from development in the Belgrade Lakes area. That study included Colby and University of Maine scientists, who collaborated with lake associations within that watershed.

In looking at the economic impact of the China Lake Watershed, the Colby researchers — Tessa Haynes, Caroline Smith, Maxine Jamison, and Angelique Bautista — looked at the demographic of the town of China. They found that the town has experienced a decline in the number of children and adults under 25 in the past decade, though the overall population has grown. Using town property tax records, U.S. Census information, coupled with Google Map’s Street View, the Colby team was able to determine that most town residents live in the Watershed.

The Colby report notes that spending generates income that— in turn— generates more spending. Workers’ income is spent on housing and food, which generates more income for other workers. Businesses spend part of that income on operating costs, which multiplies the economic effect of income circulating through the local economy.

While the Colby study didn’t examine spending by households and seasonal visitors, it did estimate the contributions of those who work in China to the overall economic activity in Kennebec County. If property within the Watershed is more desirable than property outside the Watershed, and population growth has been concentrated to areas around or near China Lake, the Watershed can be seen as playing a role in the local economic impact.

Researchers found that 586 workers in China generated more than $24 million in earnings in 2022, including $8 million from education, $7.5 million from retail, more than $4 million from construction, and more than $800,000 from health care. According to the accepted economic multiplier effect, the study found that earnings paid by firms located in the Town of China contributed more than $71 million to economic activity in Kennebec County in 2022 alone, nearly 10 percent of the County’s total economic activity of $8 billion.

The Colby team also delved into home prices within the Watershed, using data from the Town of China and digital mapping tools. Overlaying geotagged locations onto the Watershed’s boundaries, the researchers were able to establish that between 1987 and 2024 homes within the Watershed sold for 16 percent, on average, more than comparable properties outside the boundaries.

“That property value even beyond the shoreline of China Lake is a continuing boost for the town’s tax base, and reflects the lake’s value to the local area and the region,” said China Lake Association President Stephen Greene. “It also shows the importance of the health of one of the area’s attractions and economic drivers,” Greene said.

“The economic value of the lake can’t be overstated,” he said. “The work of CLA and other groups dedicated to the preserving and improving the health of the lake and its ecosystem is crucial to the economic health of the area as well.”

Read the full study here.

Graphics Left to Right:

• China Lake Watershed (red), 2022 U.S. Census Block (green)

• China Lake Watershed (red), 2022 U.S. Census Block Group

• 1-3 subdivisions (green)

• China Lake Watershed (red), Watershed households (green) and non-Watershed households (blue)

• 2022 China Lake Watershed Economic Contributions to Kennebec County