A Flexible Modeling Framework to Estimate Interregional Trade Patterns and Input-Output Accounts

Abstract

This study implements and tests a mathematical programming model to estimate interregional, interindustry transaction flows in a national system of economic regions based on an interregional accounting framework and initial information of interregional shipments. A complete national IO table, regional sectoral data on gross output, value-added, exports, imports and final demand are used as inputs to generate an interregional input-output system that reconciles regional market data and interregional transactions. The analytical and empirical properties of the model are discussed in detail. The model is tested by a 3-region 10-sector example against data aggregated from the version 4 GTAP database. It shows that the model has remarkable capacity to discover the true interregional trade pattern from highly distorted initial estimates. The paper also discusses an application of the model to estimate an interregional input-output account for the US economy based on the BEA 1997 national benchmark IO table and detailed state level data from the 1997 economic Census and other sources.

Eficiencia en la estimación de coeficientes técnicos y multiplicadores interregionales: la metodología Jahn versus las metodologías GRAS y GravityRAS

“…While it is true that the problems associated with the estimation of input-output frameworks of two or more regions is not a recent topic, addressed for example since Isard (1960), Round (1983), or Oosterhaven et al (1986), it is equally true that the current economic reality -the economic interconnection between different territories and fully globalised economies -has led to the deepening and development of estimation techniques that include this type of table. For instance, in Wang and Canning (2004), Kratena et al (2013), Többen and Kronenberg (2015), Jahn (2017), Boero et al (2018), Temursho et al (2021) or Krebs (2020).…”

“…is regionalisation method, unlike the one presented by Wang and Canning (2004) on which it is based, offers an estimate of Total Final Demand (TFD), whose origin lies in each of the differentiated regions, regardless of the destination where consumption actually takes place. us, for example, household final consumption expenditure will not only include the value of such expenditure of residents of the region of interest but will also include that of households of non-residents of the region who consume goods and services produced in the region.…”

A multiregional input–output optimization model to assess impacts of water supply disruptions under climate change on the Great Lakes economy

“…The FLQ is a well-known method to generate regional IO tables by estimating inter-industry commodity flows within the region under study (Flegg et al, 1995). Although it was originally designed to downscale national IO tables to single regions, the FLQ has also been applied to estimate MRIO tables (Canning & Wang, 2004;Jahn, 2017).…”