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Product-to-Product Tables via Product-Technology with No Negative Flows

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  • Clopper Almon

Abstract

This paper presents and evaluates a way of making product-to-product tables from Use and Make matrices that are of immediate relevance to any statistical office that makes input-output tables. Two ways of making a product-to-product table are in common practice: one based on the product-technology assumption and the other on the industry-technology assumption. The industry-technology assumption is recognized as highly implausible but is often used because the product-technology assumption frequently leads to small negative flows which make no economic sense. This paper shows how a slight adjustment in the product-technology assumption leads to an algorithm that is certain to avoid negative flows yet keeps close to the spirit of the product-technology idea. Some details of the application of this method to the USA table for 1992 are reported. Similar applications to every American table since 1958 have given consistently sensible results. A computer program for the method is available.

Suggested Citation

  • Clopper Almon, 2000. "Product-to-Product Tables via Product-Technology with No Negative Flows," Economic Systems Research, Taylor & Francis Journals, vol. 12(1), pages 27-43.
    • Handle: RePEc:taf:ecsysr:v:12:y:2000:i:1:p:27-43
    DOI: 10.1080/095353100111263
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    1. Thijs ten Raa, 2009. "An Alternative Treatment of Secondary Products in Input–Output Analysis: Frustration," World Scientific Book Chapters, in: Input–Output Economics: Theory And Applications Featuring Asian Economies, chapter 5, pages 67-76, World Scientific Publishing Co. Pte. Ltd..
    2. ten Raa, Thijs & Chakraborty, Debesh & Small, J Anthony, 1984. "An Alternative Treatment of Secondary Products in Input-Output Analysis," The Review of Economics and Statistics, MIT Press, vol. 66(1), pages 88-97, February.
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    Cited by:

    1. Gerd Ahlert, 2014. "Neuere Anwendungsfelder der Input-Output-Analyse – Tagungsband – Beiträge zum Input-Output-Workshop 2014 in Osnabrück," GWS Research Report Series 14-2, GWS - Institute of Economic Structures Research.
    2. MESNARD, Louis de, 2008. "On the impossibility of calculating the product technology in the Supply-Use model," LEG - Document de travail - Economie 2008-06, LEG, Laboratoire d'Economie et de Gestion, CNRS, Université de Bourgogne.
    3. Lars Bohlin & Lars Widell, 2006. "Estimation of commodity-by-commodity input-output matrices," Economic Systems Research, Taylor & Francis Journals, vol. 18(2), pages 205-215.
    4. Eduardo Haddad & Vasco Silva & Alexandre Porsse & Tomaz Dentinho, 2015. "Multipliers in an Island Economy: The Case of the Azores," World Scientific Book Chapters, in: Amitrajeet A Batabyal & Peter Nijkamp (ed.), THE REGION AND TRADE New Analytical Directions, chapter 8, pages 205-226, World Scientific Publishing Co. Pte. Ltd..
    5. George Soklis, 2009. "The Conversion of the Supply and Use Tables to Symmetric Input-Output Tables: A Critical Review," Bulletin of Political Economy, Bulletin of Political Economy, vol. 3(1), pages 51-70, June.
    6. Jaroslav Zbranek & Jakub Fischer, 2014. "Konstrukce a využití časových input-output tabulek pro hodnocení produktivity práce v podmínkách České republiky [Construction of the Time Input-Output Tables under Conditions of the Czech Republic," Politická ekonomie, Prague University of Economics and Business, vol. 2014(6), pages 769-784.
    7. José M. Rueda-Cantuche & Antonio Titos Moreno & Marisa Asensio Pardo, 2005. "A use-side trade margins matrix for the Andalusian economy," Economic Working Papers at Centro de Estudios Andaluces E2005/06, Centro de Estudios Andaluces.
    8. Thijs ten Raa & José M. Rueda-Cantuche, 2021. "The Problem of Negatives Generated by the Commodity Technology Model in Input-Output Analysis: A Review of the Solutions," World Scientific Book Chapters, in: Efficiency and Input-Output Analyses Theory and Applications, chapter 18, pages 319-338, World Scientific Publishing Co. Pte. Ltd..
    9. Mach, Radomír & Weinzettel, Jan & Ščasný, Milan, 2018. "Environmental Impact of Consumption by Czech Households: Hybrid Input–Output Analysis Linked to Household Consumption Data," Ecological Economics, Elsevier, vol. 149(C), pages 62-73.
    10. Croner, Daniel & Koller, Wolfgang & Mahlberg, Bernhard, 2018. "Economic drivers of greenhouse gas-emissions in small open economies: A hierarchical structural decomposition analysis," MPRA Paper 85755, University Library of Munich, Germany.
    11. W. Koller & Robert Stehrer, 2008. "Outsourcing and Employment: A Decomposition Approach," FIW Research Reports series I-018, FIW.
    12. Xesús Pereira López & Melchor Fernández Fernández & André Carrascal Incera, 2012. "Algunas consideraciones acerca de los modelos input-output rectangulares," Documentos de trabajo - Analise Economica 0049, IDEGA - Instituto Universitario de Estudios e Desenvolvemento de Galicia.
    13. Weinzettel, Jan & Pfister, Stephan, 2019. "International trade of global scarce water use in agriculture: Modeling on watershed level with monthly resolution," Ecological Economics, Elsevier, vol. 159(C), pages 301-311.
    14. Brugt Kazemier & Carlo H. Driesen & Erik Hoogbruin, 2012. "From Input--Output Tables To Supply-And-Use Tables," Economic Systems Research, Taylor & Francis Journals, vol. 24(3), pages 319-327, December.
    15. Ayele Gelan & Geoffrey J. D. Hewings & Ahmad Alawadhi, 2021. "Diversifying a resource-dependent economy: private–public relationships in the Kuwaiti economy," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 10(1), pages 1-22, December.
    16. Reiner Wolff, 2005. "A global robustness measure for input-output projections from ESA and SNA tables," Economic Systems Research, Taylor & Francis Journals, vol. 17(1), pages 77-93.
    17. Konstantins Benkovskis & Ludmila Fadejeva & Robert Stehrer & Julia Woerz, 2012. "How Important is Total Factor Productivity for Growth in Central, Eastern and Southeastern European Countries?," Working Papers 2012/05, Latvijas Banka.
    18. Konstantins Benkovskis & Ludmila Fadejeva & Julia Wörz, 2013. "How Important Is Total Factor Productivity for Growth in Central, Eastern and Southeastern European Countries?," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue 1, pages 8-27.

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