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An Armington–Leontief model

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  • Ferran Sancho

    (Universitat Autònoma de Barcelona)

Abstract

We develop a novel linear equilibrium model with an Armington flavor. We provide (1) proof of the solvability of the model and of the existence and non-negativity of the equilibrium solution and of the newly derived multiplier matrix; we also show (2) that the standard Leontief multiplier matrix arises as a special case of this new model and (3) that this model allows the computation of multiplier effects with no external output bias, which is particularly relevant for applied economic analysis.

Suggested Citation

  • Ferran Sancho, 2019. "An Armington–Leontief model," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 8(1), pages 1-10, December.
    • Handle: RePEc:spr:jecstr:v:8:y:2019:i:1:d:10.1186_s40008-019-0158-y
    DOI: 10.1186/s40008-019-0158-y
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    References listed on IDEAS

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    1. Guerra, Ana-Isabel & Sancho, Ferran, 2018. "Positive and normative analysis of the output opportunity costs of GHG emissions reductions: A comparison of the six largest EU economies," Energy Policy, Elsevier, vol. 122(C), pages 45-62.
    2. Reinert, Kenneth A. & Roland-Holst, David W., 1992. "Armington elasticities for United States manufacturing sectors," Journal of Policy Modeling, Elsevier, vol. 14(5), pages 631-639, October.
    3. Alper DUMAN & Gül ÖZGÜZER, 2012. "An Input-Output Analysis of Rising Imports in Turkey," Ekonomik Yaklasim, Ekonomik Yaklasim Association, vol. 23(84), pages 39-54.
    4. Kim J. Ruhl, 2008. "The International Elasticity Puzzle," Working Papers 08-30, New York University, Leonard N. Stern School of Business, Department of Economics.
    5. Su, Bin & Ang, B.W., 2013. "Input–output analysis of CO2 emissions embodied in trade: Competitive versus non-competitive imports," Energy Policy, Elsevier, vol. 56(C), pages 83-87.
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    Cited by:

    1. Guerra, Ana-Isabel & Sancho, Ferran, 2018. "Positive and normative analysis of the output opportunity costs of GHG emissions reductions: A comparison of the six largest EU economies," Energy Policy, Elsevier, vol. 122(C), pages 45-62.
    2. Conxita Pinyol & Ferran Sancho, 2022. "An elementary proof of the existence of the Leontief inverse," Economics Bulletin, AccessEcon, vol. 42(2), pages 662-666.

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    More about this item

    Keywords

    Armington principle; Extended linear equilibrium model; Solvability; Technological productivity;
    All these keywords.

    JEL classification:

    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis

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