Estimation Errors in Input-Output Tables and Prediction Errors in Computable General Equilibrium Analysis
AbstractWe used 1995-2000-2005 linked input-output (IO) tables for Japan to examine estimation errors of updated IO tables and the resulting prediction errors in computable general equilibrium (CGE) analysis developed with updated IO tables. As we usually have no true IO tables for the target year and therefore need to estimate them, we cannot evaluate estimation errors of updated IO tables without comparing the updated ones with true ones. However, using the linked IO tables covering three different years enables us to make this comparison. Our experiments showed that IO tables estimated with more detailed and recent data contained smaller estimation errors and led to smaller quantitative prediction errors in CGE analysis. Despite the quantitative prediction errors, prediction was found to be qualitatively correct. As for the performance of updating techniques of IO tables, a cross-entropy method often outperformed a least-squares method in IO estimation with only aggregate data for the target year but did not necessarily outperform the least-squares method in CGE prediction.
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Bibliographic InfoPaper provided by National Graduate Institute for Policy Studies in its series GRIPS Discussion Papers with number 13-16.
Length: 24 pages
Date of creation: Aug 2013
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Other versions of this item:
- Nobuhiro Hosoe, 2013. "Estimation Errors in Input-Output Tables and Prediction Errors in Computable General Equilibrium Analysis," GRIPS Discussion Papers 13-19, National Graduate Institute for Policy Studies.
- NEP-ALL-2013-08-16 (All new papers)
- NEP-CMP-2013-08-16 (Computational Economics)
- NEP-ECM-2013-08-16 (Econometrics)
- NEP-FOR-2013-08-16 (Forecasting)
- NEP-SPO-2013-08-16 (Sports & Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Andrea Bonfiglio & Francesco Chelli, 2008. "Assessing the Behaviour of Non-Survey Methods for Constructing Regional Input-Output Tables through a Monte Carlo Simulation," Economic Systems Research, Taylor and Francis Journals, vol. 20(3), pages 243-258.
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