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Using CHARM to adjust for cross-hauling: the case of the Province of Hubei, China

Author

Listed:
  • Anthony T. Flegg

    (University of the West of England, Bristol)

  • Yongming Huang

    (Wuhan University, Wuhan, China)

  • Timo Tohmo

    (University of Jyväskylä, Jyväskylä, Finland)

Abstract

Data for the Chinese province of Hubei are used to assess the performance of Kronenberg¡¦s CHARM, a method that takes explicit account of cross-hauling when constructing regional inputƒ{output tables. A key determinant of cross-hauling is held to be the heterogeneity of commodities, which is estimated using national data. However, contrary to the authors¡¦ findings for Finland, CHARM does not generate reliable estimates of Hubei¡¦s sectoral exports, imports and volume of trade, although it is more successful in estimating sectoral supply multipliers. The poor simulations of regional trade are attributed to the fact that Hubei is a relatively small region, where there is a large divergence between regional and national technology and pattern of final demand. The simulation errors are decomposed into components reflecting differences between regional and national technology, final demand and heterogeneity. The third component is found to be the least important of the three sources of error.

Suggested Citation

  • Anthony T. Flegg & Yongming Huang & Timo Tohmo, 2015. "Using CHARM to adjust for cross-hauling: the case of the Province of Hubei, China," Working Papers 20151506, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
    • Handle: RePEc:uwe:wpaper:20151506
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    References listed on IDEAS

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    1. Tobias Kronenberg, 2009. "Construction of Regional Input-Output Tables Using Nonsurvey Methods," International Regional Science Review, , vol. 32(1), pages 40-64, January.
    2. Timo Tohmo, 2004. "New Developments in the Use of Location Quotients to Estimate Regional Input-Output Coefficients and Multipliers," Regional Studies, Taylor & Francis Journals, vol. 38(1), pages 43-54.
    3. Randall Jackson, 2014. "Cross-Hauling in Input-Output Tables: Comments on CHARM," Working Papers Working Paper 2014-02, Regional Research Institute, West Virginia University.
    4. A. T. Flegg & C. D. Webber, 1997. "On the Appropriate Use of Location Quotients in Generating Regional Input-Output Tables: Reply," Regional Studies, Taylor & Francis Journals, vol. 31(8), pages 795-805.
    5. R. C. Jensen, 1980. "The Concept of Accuracy in Regional Input-Output Models," International Regional Science Review, , vol. 5(2), pages 139-154, August.
    6. Michael Lahr, 2001. "Reconciling Domestication Techniques, the Notion of Re-exports and Some Comments on Regional Accounting," Economic Systems Research, Taylor & Francis Journals, vol. 13(2), pages 165-179.
    7. Tobias Kronenberg, 2012. "Regional input-output models and the treatment of imports in the European System of Accounts (ESA)," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 32(2), pages 175-191, September.
    8. A. T. Flegg & C. D. Webber, 2000. "Regional Size, Regional Specialization and the FLQ Formula," Regional Studies, Taylor & Francis Journals, vol. 34(6), pages 563-569.
    9. Tobias Kronenberg, 2010. "Erstellung einer Input-Output-Tabelle für Mecklenburg-Vorpommern," AStA Wirtschafts- und Sozialstatistisches Archiv, Springer;Deutsche Statistische Gesellschaft - German Statistical Society, vol. 4(3), pages 223-248, September.
    10. 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 & Francis Journals, vol. 20(3), pages 243-258.
    11. Randall Jackson, 1998. "Regionalizing National Commodity-by-Industry Accounts," Economic Systems Research, Taylor & Francis Journals, vol. 10(3), pages 223-238.
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    Cited by:

    1. Lankhuizen, Maureen & Boonstra, Harm Jan & de Blois, Chris, 2020. "Unpacking freight – Identifying conditions driving regional freight transport in statistics," Transportation Research Part A: Policy and Practice, Elsevier, vol. 132(C), pages 415-435.
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    3. Schwärzler, Marion Cornelia & Kronenberg, Tobias, 2017. "Methodology of the Multiregional Health Account for Germany - An Iterative Algorithm-Based Multiregionalization Approach of Supply and Use Tables with Emphasis on Health," MPRA Paper 80712, University Library of Munich, Germany.

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    Keywords

    Regional input-output tables; Non-survey methods; CHARM; Cross-hauling; China;
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