Management Review

›› 2018, Vol. 30 ›› Issue (5): 3-8.

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Possible Extensions of Input-Output Analysis

Lawrence J. Lau   

  1. Lau ChorTak Institute of Global Economics and Finance, the Chinese University of Hong Kong, Shatin, NT, Hong Kong
  • Received:2016-11-10 Online:2018-05-28 Published:2018-05-29

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Abstract:

Input-output analysis is a valuable and useful tool for understanding the interdependence within an economy, and for economic planning and policy analysis. However, conventional input-output analysis typically assumes:(1) fixed input-output coefficients; (2) constant returns to scale; (3) the desirability of all goods; (4) given fixed infrastructure, and (5) the homogeneity of goods. While it is true that input-output coefficients are updated from time to time, endogenous changes in the input-output coefficients within a planning period can and should be taken into account. Possible extensions of input-output analysis that allow these deviations from the standard as-sumptions are proposed.

Key words: input-output analysis, extensions applicability