On the impossibility of calculating the product technology in the Supply-Use model

Louis de Mesnard

No 2008-06, LEG - Document de travail - Economie from LEG, Laboratoire d'Economie et de Gestion, CNRS, Université de Bourgogne

Abstract: The Supply-Use input-output model of the SNA and Eurostat is examined. For the product-by-product IO tables, two hypothesis are possible: “product technology”, largely adopted (Eurostat A) and examined here, and “industry technology” (Eurostat B). One examines the calculability of the model. Negatives are an issue; (i) they are systematical in the inverse supply matrix: negative probabilities are impossible, Markov chains become impossible; (ii) negative flows are nonsense in symmetric matrix of coefficients or in inverse matrices. Matrices must be square what removes much of their interest. Same conclusions can be transposed to industry-by-industry IO tables under fixed-industry-sales-structure assumption (Eurostat C).

Keywords: Input-Output; SNA; Eurostat; Supply-Use; Make-Use.. (search for similar items in EconPapers)
JEL-codes: C67 D57 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2008-10
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Persistent link: https://EconPapers.repec.org/RePEc:lat:legeco:2008-06

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