THE SENSITIVITY OF INPUT-OUTPUT MULTIPLIERS*

The present paper derives analytical expressions for the sensitivity of input-output multipliers to errors in the data. The effects on the simple output multipliers are investigated for additive errors, multiplicative errors in the columns, multiplicative errors in the rows, error rectangles, the error couple and the single error, and price changes. In contrast to earlier investigations, the results are not obtained from the Leontief inverse. The present approach focusses on the effects of errors on the eigenvector corresponding to the dominant eigenvalue. It is indicated how similar expressions may be derived for several other multipliers.     

A NOTE ON THE GENERAL MATHEMATICAL EQUIVALENCY OF ECONOMIC BASE AND AGGREGATE INPUT-OUTPUT MULTIPLIERS: FACT OR FICTION*

ABSTRACT A longstanding inconsistency in the definition of basic and nonbasic economic activity is resolved. When indirect exports are included in the basic, rather than the nonbasic sector, and the model is closed with respect to households, economic base and aggregate input-output mulitpliers constructed with the same data and definitions will be mathematically identical.     

HOUSEHOLD INCOME AND EXPENDITURE IN EXTENDED INPUT-OUTPUT MODELS: A COMPARATIVE THEORETICAL AND EMPIRICAL ANALYSIS*

ABSTRACT At the regional level in-migrant and indigenous workers are likely to have different income levels and consumption propensities. The effects that these differences have upon a local economy are explored within an extended input-output modeling framework. Two iterative input-output models, due to Miernyk et al. and Blackwell, are recast as systems of simultaneous equations and are shown to produce identical results. A detailed analysis is made of model structure and a method is outlined for the decomposition of income multipliers. Empirical versions of the two models, for Boulder and Cork, are reconstructed with data from the original studies and are used to make comparisons of the two local economies.     

EMPIRICAL TESTS OF SOME SEMI-SURVEY UPDATE PROCEDURES APPLIED TO RECTANGULAR INPUT-OUTPUT TABLES*

ABSTRACT. This paper examines the RAS, Mc Menamin and Haring, and Lagrange-multiplier update methods in the context of the dual accounting system of the rectangular input-output model. The motivation was to determine if the additional information contained in the dual system is exploitable, while maintaining the integrity of the rectangular structure with all its advantages. Tests were conducted on the performance of the various algorithms for a derivative Leontief model relative to their performance on the rectangular structure. The results obtained for rectangular tables were generally better than those obtained for the more conventional Leontief ones.     

ON THE PLAUSIBILITY OF THE SUPPLY—DRIVEN INPUT-OUTPUT MODEL: A THEORETICAL BASIS FOR INPUT-COEFFICIENT CHANGE*

ABSTRACT. Oosterhaven (1988) labels the supply-driven input-output model “theoretically implausible” and criticizes the straightforward use of the model for impact studies. This comment extends and corrects some of the issues addressed by Oosterhaven. We derive the characteristics which industry production relations must possess to be consistent with the implied changes in industry inputs and outputs when supply-side input-output models are employed for impact analysis. First, it is shown that an implicit assumption is the characteristic of perfect substitutability among all inputs in each industry production function. This is the polar opposite of the Leontief assumption of zero elasticity of factor substitution among all inputs, and is very unrealistic for large changes from the initially observed solution since it implies that all inputs are non-essential in the production process and that any input can be substituted for all others simultaneously. Second, it is shown that the model may still be reasonable for approximating the effect of small changes since the implied production relation may be interpreted as a cost minimizing choice for a standard constant-returns-to-scale production function linearized around the initial solution under the assumption that relative prices are unchanged. Under this alternative interpretation, the supply-side model may be expected to provide a reasonable approximation, useful for analyzing changes in the neighborhood of the initial solution, but would appear to be inappropriate for analyzing large changes.     

SUPPLY-SIDE MULTIREGIONAL INPUT-OUTPUT MODELS*

ABSTRACT This paper introduces a new class of supply-side multiregional input-output (MRIO) models and provides the necessary and sufficient conditions on the regional trade matrices that ensure that a generalized supply-side model will be convergent. The paper also introduces a new version of the row coefficient model, conceived as the “mirror image” of the Chenery-Moses demand-side column coefficient MRIO model. Given that the conventional supply-side input-output model has been shown to perform equally as well as the demand side model in forecasting exercises, the supply-side MRIO model is expected to be of value for policy and planning purposes. Moreover, this model is of potential theoretical value for a broad synthesis of demand-side and supply-side MRIO models.     

SOME THEORETICAL PROBLEMS IN GEOMORPHOLOGY

The author takes issue with a number of theoretical issues discussed in a recent book by Yu. G. Simonov, fellow Moscow University geomorphologist. A definition of the central problem in geomorphology as encompassing the interaction between endogenic and exogenic forces is said to leave out the role played by the landforms themselves in exerting an impact on those outside agents and, through them, on surface relief itself. Spiridonov favors a systems approach to geomorphology, but questions the suitability of the term “morphosystem” proposed by Simonov as a substitute for morphosculpture, signifying the impact of exogenic processes on landforms. Surface relief should be investigated as an open system, although some simplified situations, such as an enclosed drainage system, might be studied in terms of closed systems, making possible the use of mathematical techniques. The importance of the application of formal logic in geomorphic classification is stressed, and the use of synthetic parameters is favored for purposes of landform classification.     

A LONG-RUN INTERPRETATION OF REGIONAL INPUT-OUTPUT ANALYSIS*

ABSTRACT. Regional input-output (I-O) analysis is traditionally motivated by a short-run, extreme Keynesian vision of markets. In this paper we argue that an appropriately formulated, investment-endogenous, I-O system replicates the long-run equilibria of a wide range of regional models, many of which do not operate as I-O systems in the short run. In particular, we use a computable general equilibrium (CGE) framework to illustrate the impact of an aggregate demand disturbance on an I-O and standard neoclassical model. When run forward over a number of periods, the results from the capacity-constrained neoclassical model asymptotically approach the I-O outcome. We use sensitivity analysis to examine the speed of adjustment of the neo-classical system and investigate barriers to the attainment of the I-O result.