Advertisement

The Annals of Regional Science

, Volume 46, Issue 2, pp 427–454 | Cite as

Negatives in symmetric input–output tables: the impossible quest for the Holy Grail

  • Louis de MesnardEmail author
Original Paper

Abstract

In the Supply-Use (or Make-Use) input–output models, “product-technology” (PT) or “fixed-industry-sales-structure” (FISS) assumptions are more widely adopted (SNA, Eurostat) for deriving symmetric input–output tables (SIOT) than “industry-technology” or “fixed-product-sales-structure” assumptions, but generate negatives in the SIOT. A SIOT deduced from the Supply-Use model is considered as satisfactory as soon as it contains no more negatives; scholars have focused on the negatives in the SIOT and on how to remove them. However, as a SIOT may include no negatives even if there are some negatives in the inverse Supply matrix, we have completely reversed the reasoning. A counter-example demonstrates that computing the inverse Supply matrix, as imposed by PT or FISS assumptions, is mathematically a nonsense operation even when the symmetric input–output tables do not include any negative; this result is new. Hence, deriving a SIOT under PT or FISS assumption must be rejected. Three applications are provided: Austria 2000 and 2005 and USA 2007.

JEL Classification

C67 D57 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. Aidenoff A (1970) Input–output data in the United Nations System of National Accounts. In: Carter AP, Brody A (eds) Applications of input–output analysis, North Holland; reprinted in Ira Sohn, Ed., 1986, Readings in input–output analysis. Theory and Applications. Oxford University Press, New York: 130–150Google Scholar
  2. Almon C (1970) Investment in input–output models and the treatment of secondary products. In: Carter AP, Brody A (eds) Applications of input–output analysis North-Holland. Amsterdam, London: 103–116Google Scholar
  3. Almon C (2000) Product-to-product tables via product technology with no negative flows. Econ Syst Res 12(1): 27–43CrossRefGoogle Scholar
  4. Anderson AW, Manning TW (1983) The use of input–output analysis in evaluating water resource development. Can J Agric Econ 31(1): 15–26CrossRefGoogle Scholar
  5. Almon C (1970) Technology assumptions in the construction of U.K. input–output tables. In: Allen RIG, Gossling WF (eds) Estimating and projecting input–output coefficients. Input-Output Publishing, London: 68–93Google Scholar
  6. Bohlin L, Widell LM (2006) Estimation of commodity-by-commodity input–output matrices. Econ Syst Res 18(2): 205–215CrossRefGoogle Scholar
  7. Braibant M (2002) Transformation of Supply and Use tables to symmetric input–output tables. In: 14th Conference on Input–Output techniques, Montreal, 10–15 October 2002Google Scholar
  8. BEA (2008) Interactive Access to Input–Output Accounts Data, Bureau of Economic Analysis, Last updated 15 December 2008. http://www.bea.gov/industry/iotables/table_list.cfm?anon=97514
  9. Comer JC, Jackson RW (2003) A note on adjusting national input–output data for regional table construction. J Reg Sci 37(1): 145–153CrossRefGoogle Scholar
  10. de Mesnard L (2004) Understanding the shortcomings of commodity-based technology in input–output models: an economic-circuit approach. J Reg Sci 44(1): 125–141CrossRefGoogle Scholar
  11. de Mesnard L (2009) Is the Ghosh model interesting?. J Reg Sci 49(2): 361–372CrossRefGoogle Scholar
  12. Dietzenbacher E (1997) In vindication of the Ghosh Model: a reinterpretation as a price model. J Reg Sci 37(4): 629–651CrossRefGoogle Scholar
  13. Dietzenbacher E, van der Linden JA (1997) Sectoral and spatial linkages in the EC production structure. J Reg Sci 37(2): 235–257CrossRefGoogle Scholar
  14. Eding G, Oosterhaven J, de Vet B, Nijmeijer H (1999) Constructing regional supply and use tables: Dutch experiences. In: Hewings GJD, Sonis M, Madden M, Kimura Y (eds) Understanding and interpreting economic structure. Springer, Berlin, pp 1–9Google Scholar
  15. Eurostat (2008) Eurostat manual of Supply, Use and input–output tablesGoogle Scholar
  16. Forestry Department (1998) Economic and environmental accounting for forestry: status and current efforts. Planning and Statistics Branch, Policy and Planning DivisionGoogle Scholar
  17. Garcia-Negro, MC, Doldán-Garcia XR, Chas-Amil ML, Zotes-Tarrío Y, Carballo-Penela A, Nogueira-Moure E, Villasante-Larramendi S (2004) Application of input–output methods for the study of the Galician fishing in 1999. Input–output and global equilibrium: data, modeling, and policy analysis, Brussels, 2–4 September 2004Google Scholar
  18. Gilchrist DA, StLouis LV, Harper DJ (2000) An examination of the Leontief and Ghoshian price and quantity models: a rectangular approach. Roneo, January 2000Google Scholar
  19. Guo J, Lawson AM, Planting MA (2002) From Make-Use to Symmetric I-O Tables: An Assessment of Alternative Technology Assumption. Bureau of Economic Analysis, WP2002-03Google Scholar
  20. Guo J, Planting MA (2007) Integrating U.S. Input–output tables with SNA: valuations and extensions. In: 16th International input–output conference in Istanbul, Turkey, 2–7 JulyGoogle Scholar
  21. Harris RID, Aying L (1998) Input–output modelling of the urban and regional economy: the importance of external trade. Reg Stud 32(9): 851–862CrossRefGoogle Scholar
  22. Hoekstra R (2005) Economic growth, material flows and the environment: new applications of structural decomposition analysis and physical input–output tables. Edward Edgar publishing, Glos, UKGoogle Scholar
  23. Horowitz KJ, Planting MA (2009) Concepts and Methods of the U.S. Input–Output Accounts, Bureau of Economic Analysis, US Department of Commerce, September 2006, updated April 2009Google Scholar
  24. Israilevich PR, Hewings GJD, Sonis M, Schindler GR (1997) Forecasting structural change with a regional econometric input–output model. J Reg Sci 37(4): 565–590CrossRefGoogle Scholar
  25. Jackson RW (1998) Regionalizing national commodity-by-industry accounts. Econ Syst Res 10(3): 223–238CrossRefGoogle Scholar
  26. Kop Jansen P, ten Raa T (1990) The choice of model in the construction of input–output matrices. Int Econ Rev 31: 213–227CrossRefGoogle Scholar
  27. Lawson AM (1997) Benchmark input–output accounts for the U.S. economy, 1992. Survey of Current Business, Bureau of Economic Analysis, U.S. Department of Commerce, Washington, November 1997, pp 36–82Google Scholar
  28. Madsen B, Jensen-Butler C (1998) Commodity balance and interregional trade: make and use approaches to interregional modelling. Paper presented to the 12th International conference on input–output techniques, New York, 18–22 May 1998Google Scholar
  29. Manrique-de-Lara-Peñate C, Langa-Seva MC, Santos-Peñate D (2008) Application of IO models to Use and Destination Tourism Accounts. In: The 2008 International input–output meeting, input–output & environment, Seville, 9–11 JulyGoogle Scholar
  30. Mattey JP (1993) Evidence on input–output technology assumptions from the Longitudinal Research Database. Discussion paper 93-8, Center for Economic Studies, US Bureau of Economic Census, Washington, DCGoogle Scholar
  31. Mattey JP, ten Raa T (1997) Primary versus secondary production techniques in US manufacturing. Rev Income Wealth 43: 449–464CrossRefGoogle Scholar
  32. Miller RE, Blair PD (1985) Input–output analysis: foundations and extensions. Prentice-Hall, Englewood CliffsGoogle Scholar
  33. Miller RE, Blair PD (2009) Input–output analysis: Foundations and Extensions, 2nd edn. Cambridge University Press, Cambridge, UKCrossRefGoogle Scholar
  34. Nijmeijer H, de Vet B, Eding G (1999) Screening the Dutch Regional Accounts: Experiences from the Regional Input–Output Project. Draft Report, Statistics NetherlandsGoogle Scholar
  35. Oosterhaven J (1984) A family of square and rectangular interregional input–output tables and models. Reg Sci Urban Econ 14: 565–582CrossRefGoogle Scholar
  36. Perez J, Dones M, Llano C (2009) An interregional impact analysis of the EU structural funds in Spain (1995–1999). Papers in Regional ScienceGoogle Scholar
  37. Rainer N (1989) Descriptive versus analytical Make-Use systems: some Austrian experiences. In: Miller RE, Polenske KR, Rose AR (eds) Frontiers of input–output analysis, Oxford University Press, New York: 50–64Google Scholar
  38. Rainer N, Richter J (1992) Some aspects of the analytical use of descriptive make and absorption tables. Econ Syst Res 4: 159–172CrossRefGoogle Scholar
  39. Ravetz J (2004) Measuring regional sustainable development. A review of modeling tools in the UK. Eco-region NW, A BiffaWard project on sustainable resource useGoogle Scholar
  40. Rueda-Cantuche JM, Beutel J, Neuwahl F, Mongelli I, Loeschel A (2009) A symmetric input–output table for EU27: latest progress. Econ Syst Res 21(1): 59–79CrossRefGoogle Scholar
  41. Sayapova A, Slobodyanik S (2008) Compilation of regional input–output tables in Russia. In: The 2008 international input–output meeting, input–output & environment, Seville, 9–11 July 2008Google Scholar
  42. Schaffer W (1999) Regional Impact Models, Regional Research Institute, West Virginia UniversityGoogle Scholar
  43. Shao G, Miller RE (1990) Demand-side and supply-side commodity-industry multiregional input–output models and spatial linkages in the US regional economy. Econ Syst Res 2: 385–405CrossRefGoogle Scholar
  44. Siddiqi YM, Salem M (1995) Regionalization of commodity-by-industry input–output accounts: the Canadian Case. Statistics CanadaGoogle Scholar
  45. Statistics Austria (2009) National Accounts. Compiled on 12 February 2009. - NACE/CPA 11 incl. 13 (http://www.statistik.at/web_en/statistics/national_accounts/input_output_statistics/index.html).
  46. Steenge AE (1990) The commodity technology revisited: theoretical basis and an application to error location in the make-use framework. Econ Model 7: 376–387CrossRefGoogle Scholar
  47. Stone R (1961) Input–output and national accounts. OECD, ParisGoogle Scholar
  48. Susiluoto I (1997) An input–output study of regional economic growth: The Helsinki Region and the Rest of Finland. Studies Published by City of Helsinki Urban Facts, 1997:2Google Scholar
  49. ten Raa T (1988) An alternative treatment of secondary products in input–output analysis: frustration. Rev Econ Stat 70(3): 535–538CrossRefGoogle Scholar
  50. ten Raa T (2005) The economics of input–output analysis. Cambridge University Press, CambridgeGoogle Scholar
  51. ten Raa T, van der Ploeg R (1989) A statistical approach to the problem of negatives in input–output analysis. Econ Model 6: 2–19CrossRefGoogle Scholar
  52. ten Raa T, Rueda-Cantuche JM (2003) The construction of Input–Output coefficients matrices in an axiomatic context: some further considerations. Econ Syst Res 15: 439–455CrossRefGoogle Scholar
  53. ten Raa T, Rueda-Cantuche JM (2007) A generalized expression for the commodity and the industry technology models in input–output analysis. Econ Syst Res 19(1): 99–104CrossRefGoogle Scholar
  54. United Nations (1968) A System of National Accounts (SNA), series F, No. 2, Rev. 3, United Nations Studies in method. United Nations Department Of Economic and Social Affairs, New YorkGoogle Scholar
  55. United Nations (1999) Handbook of national accounting: input/output tables—compilation and analysis. United Nations Studies in method. United Nations Department Of Economic and Social Affairs, New YorkGoogle Scholar
  56. United Nations (2001) System of National Accounts (1993). Statistics Division—National Accounts. (http://unstats.un.org/unsd/sna1993/tocLev8.asp?L1=15&L2=4).
  57. van de Steeg AM, Steenge AE (2008) Integrating the TSA and input–output methodology in tourism impact studies. In: The 2008 International input–output meeting, input–output & environment, Seville, 9–11 July 2008Google Scholar
  58. Wood R (2008) Development of a time series of Australian input–output tables and greenhouse emissions. In: The 2008 International input–output meeting, input–output & environment, Seville, 9–11 July 2008Google Scholar

Copyright information

© Springer-Verlag 2009

Authors and Affiliations

  1. 1.Laboratoire d’Economie et de GestionUniversity of Burgundy and CNRS, UMR 5118DijonFrance
  2. 2.Regional Economics Application LaboratoryUrbana–ChampaignUSA

Personalised recommendations