Using the Leontief Matrix to Estimate the Impact of Investments upon the Global Output

by Dobrescu, Emilian & Gaftea, Viorel & Scutaru, Cornelia
Published in Romanian Journal of Economic Forecasting
, 2010, volume 13 issue 2, 176-187

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The study presents in the first chapter the applied methodology and the data used for the empirical research. The economic activities were grouped into 10 sectors by aggregating the extended input-output tables for Romania (with 105 branches). The chosen reference year is 2007 - the last year for which such statistical recordings were available.
The second chapter examines some of the Romanian economy’s structural features revealed by the matrices A and (I-A)-1, insisting on the driving effects of interdependencies (direct and indirect) generated by cross-sector productive flows.
The third chapter focuses on the impact of gross fixed capital formation (GFCF) upon the output. On the one hand, the implications of changes in volume are estimated (for example, data on 2007 are recalculated for a variation of +/-5% in the GFCF). On the other hand, the influence of the sectoral structure of the indicator in question is quantified with the help of three different macroeconomic simulations. Further possible developments of the current investigation are discussed at the end of the paper.

Keywords: input-output analysis, multipliers, macroeconomic simulations
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