An alternative for tracing the path between supply and use tables in current and constant prices

Abstract

Supply and use tables (SUT) in constant prices ensure coherent volume and price information across economic accounts. They are needed to appropriately measure technological change and connect physical and monetary models. To estimate SUTs in constant prices, researchers normally apply commodity-specific deflators to SUTs. From an economics perspective, deflators are undoubtedly cell-specific since exchanges of a commodity occur in different markets and institutional contexts. RAS can be used to calculate such cell-specific deflators. But deflating SUTs via RAS can become impossible due to excessive information requirements. This article revisits Path-RAS and applies it to build SUTs in constant prices. Our methodology lowers information requirements, enables cell-specific deflators, and avoids ad hoc adjustments. Additional information about specific industries or products can be included if existing and non-conflicting. We provide an empirical application based on the current 27 European Union countries to explore the accuracy of our estimations considering different information scenarios.