Introduction to Regional Input-Output Model

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Keynesian Regional Multiplier Income = Aggregate Demand Y = C (Consumption) + I (Investment) + G (Gov. Exp.) + X (Export) – M (Import) • C=a+bY, M=c+dY Y = a + b(1-t)Y + I + G + X – c – d(1-t)Y Y = (a – c + I + G + X) / [1 – (b - d)(1-t)] Keynesian multiplier k=1/[(1-(b-d)(1-t)] • An exogenous increase in I of $1 will increase Y by k=1/[1-(bd)(1-t)]. • b-d : marginal propensity to consume locally produced good Application: ΔY = Δ(a –c + I + G + X)/[1- (b–d)(1-t)]
Macro Economics ? Micro Economics ? Structure of economy!! Why Input-Output Analysis? Industrial interdependence and interaction!! • The IO model is centered on the idea of interindustry transactions, that is industries use the products of other industries to produce their own products. Quesnay, 1758; Walras, 1874; Leontief, 1936 (Nobel Prize in 1973).
Page 1 and 2: Introduction to Regional Input-Outp
Page 3: Economic base model Total employme
Page 7 and 8: Household and Industry Households b
Page 9 and 10: Production technology, production f
Page 11 and 12: Input-Output Model (I-A)X=Y or X =
Page 13 and 14: Making technical coefficients Examp
Page 15 and 16: Example dZ ij Purchases Sales X 1 X
Page 17 and 18: A : n X n Open (Type I) Model Total
Page 19 and 20: Closed (Type II) Model H R : househ
Page 21 and 22: Regional Input-Output Model Nationa
Page 23 and 24: Single region vs. Many region model
Page 25 and 26: a RR ij = z RR ij / X R j a LL ij
Page 27 and 28: Regional Technical Coefficient a ij
Page 29 and 30: Interregional Model Interregional t
Page 31 and 32: Interregional Model L LR LR LL LL L
Page 33 and 34: Multiregional Model ⎥ ⎦ ⎤ ⎢

Introduction to Regional Input-Output Model

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