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17 APPENDIX 5. THE SAM MODEL
The SAM framework
The framework for the Social Accounting Matrix (SAM) was first developed in the 1950s as an
extension of the core national accounts in order to integrate economic and social aspects of
development (Pyatt & Round 1985). The SAM began to be more widely used for policy in the
1970s when it became clear that economic development, measured by growth in GDP, could
not ensure poverty reduction, and that a tool to monitor income distribution was needed. The
SAM is now included as part of the 1993 revision of the System of National Accounts, the
framework used by virtually all countries for compiling national accounts (UN 1993).
The SAM is a comprehensive, economy-wide database using a double-entry bookkeeping
approach to present the data in a square table format. Data from the National Accounts and
statistics about households and other institutions are used to construct accounts for
• Supply of products from imports and domestic production
• Production structure of each industry
• Generation of income by each industry
• Redistribution of incomes among institutions, for example transfers among different
groups of households, transfers from government to households, taxes paid by
households and enterprises to government, etc.
• Detailed expenditure patterns of households and other institutions
• Saving and investment
• Transactions with the rest of the world (ROW), imports and exports
Each account is represented by a row and column, as seen in Figure 1: reading the SAM
across a row shows the incomes or sales revenue of an account, while reading the SAM
down a column shows the expenditures or outlays of that account. The principle of
accounting requires that total revenue (row total) equals total expenditure (column total). A
Basic SAM was constructed for Botswana for the year 2002-2003 (Thurlow 2006). The Basic
SAM has been modified for the analysis of economic activities in the Okavango Delta by
expanding the number of Agricultural activities from 3 industries to 8 and expanding tourism
related activities from 1 to 12.
Two additional categories of income were added in order to better represent the benefits of
local communities from the resources of the Delta: rents and royalties for use of traditional
land for tourism, and mixed income from agriculture in the Delta communal land. These are
described below.
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