Decomposition of Malaysian Production Structure Input-Output Approach

Abstract

Structural decomposition techniques are widely used to break down the growth in some variable into the changes in its determinants. Over the past two decades, input-output structural decomposition analysis (SDA) has developed into a major analytical tool. We review the development of SDA and its relationship to other methodologies. We present the fundamental principle of alternative approaches to deriving SDA estimating similarities and explore the various & decompositions of changes in I-0 tables. Using I-O Tables for the Malaysian Economy 1983-2000, this comparative study focuses on changes in the economic structure with different levels of development over time (1983-2000). The change in the economic structure is decomposed into two initial components (Technology and total output). According to the results, there are similarities over time in the national structure of production patterns of intermediate use of commodities. Also, the results indicate a rather remarkable degree of commonality in the patterns of growth processes, with more significant differences between sectors than between tables. However, the most changes within sectors, and the Malaysian table as a whole, seem to result from changes in x, and f. A seems to have remained relatively unchanged.