A network approach for assembling and linking input–output models

Abstract

Input-output (IO) models, describing trade between different sectors and regions, are widely used to study the environmental repercussions of human activities. A frequent challenge in assembling an IO model or linking several such models is the absence of flow data with the same level of detail for all components. Such problems can be addressed using proportional allocation, which is a form of algebraic transformations. In this paper, we propose a novel approach whereby the IO system is viewed as a network, the topology of which is transformed with the addition of virtual nodes so that available empirical flow data can be mapped directly to existing links, with no additional estimation required, and no impact on results. As IO systems become increasingly disaggregated, and coupled to adjacent databases and models, the adaptability of IO frameworks becomes increasingly important. We show that topological transformations also offer large advantages in terms of transparency, modularity and increasingly importantly for global IO models, efficiency. We illustrate the results in the context of trade linking, multi-scale integration and other applications.

EXIOBASE 3: Developing a Time Series of Detailed Environmentally Extended Multi‐Regional Input‐Output Tables

“…[]; Rodrigues et al. []). In this procedure, re‐exports are set to zero in the multiregional MSUT, and import shares calculated from are multiplied by the import use matrix in order to give the multiregional import‐use tables.…”

“…pricing). The single-region import table can then be disaggregated to point of origin assuming that each industry and final consumer purchase the same relative portion of goods from exporting countries (known as the "proportionality assumption" cf Peters et al [2011]; Rodrigues et al [2016]). In this procedure, re-exports are set to zero in the multiregional MSUT, and import shares calculated from B d om,0 i,r,s are multiplied by the import use matrix in order to give the multiregional import-use tables.…”

Opportunity for a Dietary Win-Win-Win in Nutrition, Environment, and Animal Welfare

“…8 Recent comparisons of physical trade matrices with high sectoral and spatial resolutions but truncated system boundaries, and multiregional input-output models with lower resolutions but complete system boundaries have shown that the two approaches lead to different and possibly even opposing results. 50,51 Approaches to link databases of different resolutions, classifications, and units have been developed, 52,53 and can be used to achieve a synergy. A prominent attempt to link FAOSTAT with EXIOBASE is the FABIO model.…”

Modelling Network Interdependencies of Regional Economies using Spatial Econometric Techniques

“…Considering whether the framework of network theory can be employed to describe the interregional interindustry linkages, Rodrigues et al (2016) illustrate the case of an input-output model in which the network approach can result in much clearer and more flexible modelling techniques than conventional matrix formulations. Additionally, they point out the advantages of the topological transformations applied to these network structures.…”