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Teknik Iterasi Penyelesaian Model Multisektor Dinamis

Author

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  • Edison Hulu

    (Indonesia)

Abstract

All the multisector models start with the inpitt-output model, which captures sectoral interdependence arising from the flow of intermediate goods among sector. Even with its strong linearity assumptions, input-output models and their extensions represent powerful tools for applied equilibrium analysis. For industry studies, it is useful to distinguish its applications, such as the analysis of the economic structure, formulation of the program action, and prediction of future event. In terms of the mathematical structure or the methodology of the model, the development of the input-output models are tivo ways, the static and dynamic formulation. In the static input-output model, all the component of final demand are treated as exogenous variables. The dynamic model treats investment demand as endogenous and incorporates tivo fundamental assumption about technology and capital. These assumptions are (i) fixed incremental capital-output ratios by sectors, and (ii) sectoral capital stocks have a fixed compositional structure by sector of origin. In this paper the author deals with the dynamic input-output model, particularly in the solution procedure of the model. In fiziding the solution of the model, the inverse of the capital matrix is assumed to exist. In fact, because many sectors do not produce capital goods, it means that some of the diagonal elements of the capital matrix in the dynamic input model will be zero, then the solution of the model does not exist. This problem is called the singularity problem associated with the difference equation of Leontief s multisector dynamic model. Some of the existing studies such as Kenderick (1972), Kreijger and Neudecker (1976), Livesey (1976), Schinnar (1978) are concerned ivith solving the singularity of the model, but the results are still debated. In this paper the author examine one approach of solving the dynamic input-output model by using the Seidel's iterative calculation. This approach will not produce unique solution that converge toward the stability condition.

Suggested Citation

  • Edison Hulu, 1996. "Teknik Iterasi Penyelesaian Model Multisektor Dinamis," Economics and Finance in Indonesia, Faculty of Economics and Business, University of Indonesia, vol. 44, pages 297-319, December.
  • Handle: RePEc:lpe:efijnl:199615
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