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The Weight of Essentials in Economic Activity

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  • Baki Güney Işıkara

Abstract

The paper develops a measure for the weight of essential goods and services in different spheres of economic activity. The first measure is concerned with the sphere of production, which makes use of World Input-Output Tables to construct net-product subsystems so as to estimate the total (direct and indirect) share of essentials. The second measure approaches the same question from the consumption side and relies on Organization for Economic Cooperation and Development data. The results lie roughly in the interval of 45–70 percent and 60–85 percent in the spheres of production and consumption, respectively, with significant variation across countries. Other than certain patterns captured in cross-country group comparisons, evidence is found for the aggregate-level counterpart of Engel’s Law on the production side. The results have important implications when read in the context of the literature on the welfare state, de(commodification), universal basic income, and the imperative to adjust consumption and production in response to the looming ecological crisis.

Suggested Citation

  • Baki Güney Işıkara, 2021. "The Weight of Essentials in Economic Activity," Review of Radical Political Economics, Union for Radical Political Economics, vol. 53(1), pages 95-115, March.
    • Handle: RePEc:sae:reorpe:v:53:y:2021:i:1:p:95-115
    DOI: 10.1177/0486613420906900
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    References listed on IDEAS

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    1. Marcel P. Timmer & Erik Dietzenbacher & Bart Los & Robert Stehrer & Gaaitzen J. Vries, 2015. "An Illustrated User Guide to the World Input–Output Database: the Case of Global Automotive Production," Review of International Economics, Wiley Blackwell, vol. 23(3), pages 575-605, August.
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    More about this item

    Keywords

    basic needs; essentials; subsystems; decommodification; demarketization;
    All these keywords.

    JEL classification:

    • B51 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Socialist; Marxian; Sraffian
    • O20 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - General
    • P11 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Planning, Coordination, and Reform

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