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Integrating A Household Demand System In The Input-Output Framework. Methodological Aspects And Modelling Implications


  • Ignazio Mongelli
  • Frederik Neuwahl
  • Jose Rueda-Cantuche


In this paper we argue that an accurate representation of household consumption behaviour is central to the analysis and comparison of policy interventions addressing sustainable consumption. Therefore, we propose to extend an input-output model with a specific household consumption model, at the core of which is a system of equations explaining the allocation of the households' overall expenditure across different purposes, such as buying food, the consumption of fuel for heating or electricity for cooling, education of children or travelling in terms of total expenditure and relative prices. This paper shows that the integration of a specific module for household consumption in a standard input-output model is an improvement for the analysis of the policies aimed at altering consumer behaviour.

Suggested Citation

  • Ignazio Mongelli & Frederik Neuwahl & Jose Rueda-Cantuche, 2010. "Integrating A Household Demand System In The Input-Output Framework. Methodological Aspects And Modelling Implications," Economic Systems Research, Taylor & Francis Journals, vol. 22(3), pages 201-222.
  • Handle: RePEc:taf:ecsysr:v:22:y:2010:i:3:p:201-222 DOI: 10.1080/09535314.2010.501428

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    References listed on IDEAS

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    5. Timothy J. Kehoe, 2003. "An evaluation of the performance of applied general equilibrium models of the impact of NAFTA," Staff Report 320, Federal Reserve Bank of Minneapolis.
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    8. Finnoff, David & Tschirhart, John, 2003. "Harvesting in an eight-species ecosystem," Journal of Environmental Economics and Management, Elsevier, vol. 45(3), pages 589-611, May.
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    1. repec:eee:ecolec:v:140:y:2017:i:c:p:46-57 is not listed on IDEAS
    2. Dai, Hancheng & Masui, Toshihiko & Matsuoka, Yuzuru & Fujimori, Shinichiro, 2012. "The impacts of China’s household consumption expenditure patterns on energy demand and carbon emissions towards 2050," Energy Policy, Elsevier, vol. 50(C), pages 736-750.
    3. Brizga, Janis & Feng, Kuishuang & Hubacek, Klaus, 2017. "Household carbon footprints in the Baltic States: A global multi-regional input–output analysis from 1995 to 2011," Applied Energy, Elsevier, vol. 189(C), pages 780-788.
    4. Rocchi, Paola & Serrano, Mònica & Roca, Jordi, 2014. "The reform of the European energy tax directive: Exploring potential economic impacts in the EU27," Energy Policy, Elsevier, vol. 75(C), pages 341-353.


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