TY - JOUR

T1 - The problem of negatives generated by the commodity technology model in input–output analysis

T2 - A review of the solutions

AU - Ten Raa, T.

AU - Rueda-Cantuche, J.

PY - 2013

Y1 - 2013

N2 - Many economic models (e.g., computable general equilibrium models, econometric input–output models) revolve around a matrix of technical coefficients. However, these matrices can be estimated only once every 5 years as long as they are calculated from input–output tables and these are only published on a 5-year basis. Alternatively, use and make (or supply) tables are being regularly published on a yearly basis. However, they need to be converted into input–output tables as a previous step to form the matrix of technical coefficients. In doing so, this paper aims to shed light on the construction process of input–output tables and to guide economic modelers in making a decision on the way to make such conversion and how to deal with the subsequent problems, particularly with negative technical coefficients.

AB - Many economic models (e.g., computable general equilibrium models, econometric input–output models) revolve around a matrix of technical coefficients. However, these matrices can be estimated only once every 5 years as long as they are calculated from input–output tables and these are only published on a 5-year basis. Alternatively, use and make (or supply) tables are being regularly published on a yearly basis. However, they need to be converted into input–output tables as a previous step to form the matrix of technical coefficients. In doing so, this paper aims to shed light on the construction process of input–output tables and to guide economic modelers in making a decision on the way to make such conversion and how to deal with the subsequent problems, particularly with negative technical coefficients.

M3 - Article

VL - 2

SP - 1

EP - 14

JO - Journal of Economic Structures

JF - Journal of Economic Structures

SN - 2193-2409

IS - 5

ER -