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NoteAbout the Concept of “Net Multipliers”

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  • Louis De Mesnard

Abstract

Net multipliers, as introduced by Oosterhaven and Stelder (2002) accept outputs as entries instead of final demand. They are found by multiplying ordinary multipliers by the final demand ratio over the sector’s output. This pragmatic solution suffers from ratio instability over time. The alternative net multipliers proposed here are based on the interpretation of the Leontief inverse matrix for the effects generated at each round. The new solution is not sensitive to the size of impacts. Now net multiplier is equal to the corresponding ordinary multiplier minus one, and the ordering of multipliers is unchanged.

Suggested Citation

  • Louis De Mesnard, 2002. "NoteAbout the Concept of “Net Multipliers”," Journal of Regional Science, Wiley Blackwell, vol. 42(3), pages 545-548, August.
    • Handle: RePEc:bla:jregsc:v:42:y:2002:i:3:p:545-548
    DOI: 10.1111/1467-9787.00271
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    Cited by:

    1. Hu Un Gim & Koonchan Kim, 2008. "Note on the Decomposition by Factors in Direct AND Indirect Requirements," Korean Economic Review, Korean Economic Association, vol. 24, pages 259-282.
    2. Manuel Alejandro Cardenete & Ferran Sancho, 2012. "The Role Of Supply Constraints In Multiplier Analysis," Economic Systems Research, Taylor & Francis Journals, vol. 24(1), pages 21-34, June.
    3. Lenzen, Manfred & Murray, Joy & Sack, Fabian & Wiedmann, Thomas, 2007. "Shared producer and consumer responsibility -- Theory and practice," Ecological Economics, Elsevier, vol. 61(1), pages 27-42, February.
    4. Gunnar Lindberg, 2011. "On the appropriate use of (input-output) coefficients to generate non-survey regional input-output tables: Implications for the determination of output multipliers," ERSA conference papers ersa10p800, European Regional Science Association.
    5. Ferran Sancho, 2013. "Some conceptual difficulties regarding ‘net’ multipliers," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 51(2), pages 537-552, October.
    6. Ngaio Hotte & U. Sumaila, 2014. "How much could a tanker spill cost British Columbians?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 16(1), pages 159-180, February.
    7. repec:dgr:rugsom:04c01 is not listed on IDEAS
    8. Fidel Aroche Reyes, 2014. "The Greek Economic Structure in the 2000's: A Road to Crisis?," South-Eastern Europe Journal of Economics, Association of Economic Universities of South and Eastern Europe and the Black Sea Region, vol. 12(1), pages 35-64.
    9. Francois Coppens, 2005. "Indirect effects - a formal definition and degrees of dependency as an alternative to technical coefficients," Working Paper Research 67, National Bank of Belgium.
    10. Erik Dietzenbacher & Manfred Lenzen & Bart Los & Dabo Guan & Michael L. Lahr & Ferran Sancho & Sangwon Suh & Cuihong Yang, 2013. "Input--Output Analysis: The Next 25 Years," Economic Systems Research, Taylor & Francis Journals, vol. 25(4), pages 369-389, December.
    11. Oosterhaven, Jan, 2004. "On the definition of key sectors and the stability of net versus gross multipliers," Research Report 04C01, University of Groningen, Research Institute SOM (Systems, Organisations and Management).

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