A Non-Possibility Theorem for Joint- Stability in Interindustry Models

Ana-Isabel Guerra and Ferran Sancho

No 580, Working Papers from Barcelona School of Economics

Abstract: Joint-stability in inter-industry models relates to the mutual simultaneous consistency of the demand-driven and supply-driven models of Leontief and Ghosh, respectively. Previous work has claimed joint-stability to be an acceptable assumption from the empirical viewpoint, provided only small changes in exogenous variables are considered. We show in this note, however, that the issue has deeper theoretical roots and offer an analytical demonstration that shows the impossibility of consistency between demand-driven and supply-driven models.

Keywords: Interindustry modeling; joint-stability; demand-driven; supply-driven (search for similar items in EconPapers)
JEL-codes: C62 C67 O21 (search for similar items in EconPapers)
Date: 2015-09
New Economics Papers: this item is included in nep-hme
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Citations: View citations in EconPapers (2)

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Related works:
Working Paper: A NON-POSSIBILITY THEOREM FOR JOINT-STABILITY IN INTERINDUSTRY MODELS (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:bge:wpaper:580

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