A New Input-Output Table Built from Neoclassical Analysis that Considers Economic Rent

Abstract

Despite the extended use of the input-output framework, its acceptance among economists is limited due to lack of microfoundations and imposed omission of economic rent. A new input-output table is built from basic neoclassical profit maximization, which explicitly considers economic rent. The new table holds eight differences with conventional open input-output tables which enhances the framework’s theoretical basis, allows for economic rent, and yields new insights into economic structures.JEL Codes: C67, D57