We study the use of effective transfer matrices for the numerical comp
utation of masses (or correlation lengths) in lattice spin models. The
effective transfer matrix has a strongly reduced number of components
. Its definition is motivated by a renormalization-group transformatio
n of the full model onto a one-dimensional spin model. The matrix elem
ents of the effective transfer matrix can be determined by Monte Carlo
simulation. We show that the mass gap can be recovered exactly from t
he spectrum of the effective transfer matrix. As a first step towards
application we performed a Monte Carlo study for the two-dimensional I
sing model. For the simulations in the broken phase we employed a mult
imagnetic demon algorithm. The results for the tunneling correlation l
ength are particularly encouraging.