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A Comparison Of Input-Output Models:Ghosh Reduces To Leontief (But 'Closing' Ghosh Makes It More Plausible)

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  • Ana-Isabel Guerra
  • Ferran Sancho

Abstract

Ghoshs model is discussed in this paper under two alternative scenarios. In an open version we compare it with Leontiefs model and prove that they reduce to each other under some specific productive conditions. We then move onto reconsidering Ghoshs model alleged implausibility and we do so reformulating the model to incorporate a closure rule. The closure solves, to some extent, the implausibility problem very clearly put out by Oosterhaven for then valueadded is correctly computed and responsive to allocation changes resulting from supply shocks.

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Bibliographic Info

Paper provided by Barcelona Graduate School of Economics in its series Working Papers with number 450.

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Date of creation: Apr 2010
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Handle: RePEc:bge:wpaper:450

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Keywords: Multi-sectoral Input-Output Models; Market Economy; Planned Economy;

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  1. Louis de Mesnard, 2009. "Is The Ghosh Model Interesting?," Journal of Regional Science, Wiley Blackwell, Wiley Blackwell, vol. 49(2), pages 361-372.
  2. Louis de Mesnard, 2009. "On the fallacy of forward linkages: A note in the light of recent results," LEG - Document de travail - Economie, LEG, Laboratoire d'Economie et de Gestion, CNRS, Université de Bourgogne 2009-05, LEG, Laboratoire d'Economie et de Gestion, CNRS, Université de Bourgogne.
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