Reservoir recreation affects the economy of the local area and also the larger region in which the reservoir is located. This study estimated the local economic impact of recreation activities at Norris Lake on a three-county rural area of East Tennessee. The impact consists of the primary and secondary effects. The primary effect is determined by estimating the employment and payroll of enterprises which sell goods and services to visitors. Estimation of the secondary effect requires the construction of local income and employment multipliers; these are estimated by the use of economic base theory. The economic effects of reservoir recreation are compared with those due to the establishment of a concentration of water-oriented manufacturing industry at New Johnsonville in west Tennessee. (Author)