Performance of Bidimensional Location Quotients for Constructing Input-Output Tables

Abstract

This article seeks to verify the extent at which the formulation of two-dimensional location quotients (2D-LQ) entails a methodological advance in building or generating economic accounts related to sub-territories drawing from basic information. The input-output tables of the Euro Area 19 for 2010 and 2015 are taken as a reference for analysis, and five statistics are used to measure the degree of similarity between the true domestic coefficient matrices for ten countries (namely Austria, Belgium, Estonia, France, Germany, Italy, Latvia, Slovakia, Slovenia and Spain) and the matrices generated from them using non-survey techniques CILQ, FLQ, AFLQ and 2D-LQ. Focus is substantially centred on comparing the results from the four aforementioned techniques to rank methodological efficiency. Standard parameters (associated with 2D-LQ) are also provided as a guide in this scope of work with a view to ascertaining optimal parameters.