Interregional Input-output Analysis Research Articles

Economic Simulation of Central Java: Indonesia’s Province-Based IRIO Analysis

This study simulates increased sectoral investment in the economy of Central Java Province, Indonesia. Using output and household income indicators, several policy scenarios are applied to Indonesia's interregional input-output (IRIO) tables, including green economic scenarios. The aim of this research is to identify the most impactful policy on the economy of Central Java based on the results of investment policy simulations. Investment injections are conducted in production sectors within Central Java and in sectors outside the province. By assessing the direct, indirect and induced effects on economic sectors and households, cross-sectoral insights for regional development policies, the simulation results show that the Central Java economy experiences the best impact in terms of sectoral household output and income levels. In IRIO analysis, this impact is seen as a multiplier effect from sectors within and beyond Central Java. The findings imply that policies focused on local sector development will generate the highest income levels and largest output multiplier for Central Java given the existing economic conditions, while green economic policies do not have insignificant economic impacts compared to non-green policies. It is crucial to develop additional policy scenarios targeting both local and non-local industries to obtain more sensitive simulation results.

Deindustrialization in a Marxian perspective: An empirical study of the Brazilian economy between 1995-2010

The article brings new indicators that reinforce the thesis that the Brazilian economy went through a process of deindustrialization. Based on the guiding principle of Marx's reproduction schemes, the instrument of inter-regional input-output analysis was used as empirical method. The output multipliers obtained from the Leontief and Ghosh models were used as indicators for measuring structural changes. Critical situations that can show whether there were structural changes in the sectors of the economy, considering both the local economic activity and its relationship with the world economy, are presented. The main results confirm the existence of a deindustrialization of the Brazilian economy. However, it was found that, in absolute and relative terms, the reduction in the capacity of the Brazilian manufacturing to drive the economy oscillated between moments of greater and lesser intensity. Furthermore, strong indications that the Brazilian primary sector is becoming an enclave were found.

Multipler Effect in East Java (Input-Output Analysis Approach)

This study aims to examine the fundamentals of the economy of East Java with an Interregional Input-Output analysis approach. Produce 5 leading sectors (BL 1 FL 1) namely manufacturing industry, electricity supply, gas, transportation and warehousing, information and communication and company services. Changes in final demand (Household consumption, LNPRT consumption, Government Consumption, Gross Fixed Capital Formation, Inventory Change, Overseas Exports, Exports Between Provinces) indicate that the processing industry is very dominant in experiencing changes. The multiplier impact 1) output is dominated by electricity, gas 2) income is dominated by the Defense Administration and Mandatory Social Security 3) Employment is dominated by agriculture, forestry and fisheries. The Impact of Spread including manufacture, procurement of electricity, gas, construction, transportation and warehousing, provision of accommodation and food and drink, information and communication, company services, health services, and social activities. The Degree of Sensitivity including agriculture, forestry and fisheries, manufacture, procurement of electricity, gas, wholesale and retail trade, car and motorcycle repair, transportation and warehousing, information and communication, company services.

ECONOMIC IMPACT ASSESSMENT OF VILLAGE FUND IN INDONESIA USING INTER-REGIONAL INPUT OUTPUT ANALYSIS

The economic development of a region/country is marked by development in various sectors and regions through private or public spending. In 2017, village fund (as one of government expenditure) has induced and supported sectors such as public administration, human health and social works, education, manufacturing industries and other service activities in any region. This study aims to analyze the impact of the 2017 village fund program realization on the Indonesian economy, such as the impact on final demand, household income, and employment coverage. The method used in this research is Inter-Regional Input Output (IRIO) analysis using the IRIO Indonesia Table in 2016 domestic transactions on producer prices classification 102 x 102 sectors (6 regions and 17 sectors). The results of this study show Indonesia's total domestic output in 2017 for the realization of the village fund budget of IDR 98 trillion. Meanwhile, Village Fund 2017 program stimulated a total salary increase of IDR 26.980 trillion or 648,132 additional workers or contributed to employment increase during 2017 as 13.12%. The results of the analysis of the output multiplier and the income multiplier show that, if we viewed in sectoral details, the electricity and gas sector and the manufacturing industry sector have more roles in increasing output compared to other sectors.

An interregional input–output analysis with the Eaton–Kortum model

This study proposes a multi-regional input–output (I–O) model obtained from comparative statics analysis and a linear approximation of Eaton and Kortum's (2002). [Technology, geography, and trade. Econometrica, 70(5), 1741–1779. https://doi.org/10.1111/ecta.2002.70.issue-5] general equilibrium trade model. The derived reduced form, which represents the effect of a final demand shock, is equivalent to the Leontief inverse, which means that our model is a straightforward extension of the conventional I–O framework. In addition, supply-side shocks, such as a decrease in transport costs, and the corresponding welfare gains are also calculated without setting any structural parameters. The linear reduced forms also enable us to decompose the welfare gains into various ripple channels, such as by sector, region, or the time that the gain arrives. A Japanese multi-regional I–O table is used as a numerical example to derive the effect of a reduction in transport costs (for the links around the northern region). The results indicate that more than half of the welfare gains in the southwest region are delivered through indirect channels, and their time to arrival is more than twice of that in the northern region, which is close to the shock.

Off We Go! An interregional input-output analysis of e-hailing in Brazil

This study aims to assess the nature and the magnitude of the productive links of consumer operations made possible by the revenue generated by ride-hailing. We seek to map the interdependencies established between the consumption decisions of drivers that use the 99 app, a leading e-hailing provider, with other sectors and segments of the Brazilian economy. The dataset comprises operational information from 99 and an interregional input-output table for the Brazilian economy. In 2019, the intermediated trips only for 99 unfolded in more than 12 billion (BRL) added to the Brazilian GDP (equivalent to 0.18% of the total), each sector of the Brazilian economy being affected in different magnitudes. This study shows the degree of interdependence between these sectors and 99's business. In addition to the value added, indirect taxes were collected in the order of 1 billion (BRL), and 267.9 thousand jobs were generated.

Spatial Spillover Effect of East Java Economic Growth

The present study tries to examine the strategic role of East Java’s economic performance toward national level in spatial-based development. In spatial views, the economics of East Java statistically significant to improve economic growth in the neighboring area or provinces, and also support the East Java’s economic growth itself. The methodology uses for the present study consists of two methods, that are Inter-Regional Input-Output (IRIO) and Spatial Econometrics. First, the IRIO analysis shows the existing of Inter-Regional Spillover Effect in economics of East Java Province. Next, the authors examine if the economy of East Java Province experiences positive growth, it will encourage output growth in Java Island and improve the value added in eastern of Indonesia. Second, the result of SDM confirm that the existing of spatial spillover effect in Inter-Regional Economic of East Java Province. The result confirms the key role to boost economic growth of district/cities in East Java Province, is not only influenced by the region itself (local economy) but also support by spatial interactions with other regions (neighborhood or neighbors). The present study also finds that the neighboring GDRP per capita with other determinants i.e., capital, share of the agriculture sector, share of manufacturing industry and share of the service sector and local government spending have a significant effect on enhancing economic growth in East Java Province. The authors note that it is necessary to consider a spatial framework and approach. One of the policy recommendations in order to encourage economic growth in East Java is to strengthen the Local Value Chain (LVC) in strategic sectors, especially by encouraging inter-regional cooperation.

Changes in the Regional Structure of China's Domestic Market and Implications

In response to intensifying conflict with the United States and the shock of Covid-19, China reinforced its strategy to expand domestic demand. China's domestic market is an important factor affecting Korea's exports and economic growth. Accordingly, a large body of research has been conducted in Korea on China's expansion policy and changes in its domestic market. However, most studies have analyzed changes in China's consumer market, import market and imported items, limiting the overall understanding of China's domestic economy. In addition, most studies on China's regional domestic market have analyzed the market segmented by region. Recognizing this gap, this study expanded the scope of analysis of the domestic market in China to the entire domestic final demand, and analyzed inter-regional trade relations and other economic relations based on an inter-regional input-output analysis, which has rarely been attempted in analyses of the Chinese domestic market. In addition, the changes in the regional structure of the Chinese import market and Korea's competitiveness were analyzed using Chinese trade statistics. In particular, by synthesizing the changes after the global financial crisis, a turning point in China's economic structure, we project future changes in the regional economic structure of China, which emphasizes the independence of its domestic economy. In addition, in the era of US-China conflict, the study aimed to select regional markets meaningful to Korea, and to present strategic directions toward China focusing on regional cooperation and approaches into the domestic market.

Estimation of socioeconomic impacts of wind power projects in Brazil's Northeast region using Interregional Input-Output Analysis

Brazil's Northeast is the country's least developed region and accounts for half of its potential for wind power generation. Recent wind energy projects have directed substantial investment flows to this region and are expected to propel regional socioeconomic development. This paper estimates interregional socioeconomic impacts of onshore wind power deployment in Brazil's Northeast region by applying a new Interregional Input-Output model with endogenized households. By assessing the direct, indirect and induced effects on economic sectors and households, cross-sectoral insights for regional development policies are identified. The set of projects considered consists of 2911 MW procured through auctions, which will become operational by 2023. Results show significant indirect and induced multiplier effects. Results indicate that 10 jobs/MW are created directly, while the total effect is 31.9 jobs/MW, meaning indirect and induced effects can be more than three times higher than direct impacts. More than 50% of the benefits occur in just a few key sectors. In the Northeast, the highest potential benefit on value added is revealed in the sectors: wholesale and retail trade; R&D and other business activities; financial intermediation; and real estate activities. These sectors reflect the potential for induced economic co-benefits mainly. However, the Rest of Brazil captures a significant part of total benefits, especially high-income jobs and high value-added activities. Therefore, we recommend that regional development policies focus on key sectors identified here and human development to provide O&M personnel and long-lasting benefits. Lastly, we discuss justice and equality issues related to our results.

Water conservation and regional equity: An Energy–Water nexus perspective on how Seoul’s efforts relieve energy burdens on electricity-producing areas

Cities depend on other regions because of their size, activity level, and lack of resources. Their water and energy are embedded in economic trade and transactions, so they are linked with other areas through socioeconomic networks. The equity implications of water-related energy interdependence have not been explored in South Korea, even though energy production and consumption are unevenly distributed across the country. This study analyzed Seoul’s dependence on other regions for its water-related electricity consumption and the impact of Seoul’s water-saving efforts on other regions’ electricity generation. It used an interregional input–output analysis that included 16 regions and nine sectors. The study found that Seoul produced only 3.2% of the electricity that was required to supply water to the city: the balance came from other regions. Seoul conserved 64,671,551 m3 of water from 2013 to 2017 by harvesting rainwater, reusing water, and reclaiming wastewater. This resulted in reduced electricity production, mostly in other regions, by 14,799.36 MWh. By incorporating regional equity, this study identified additional benefits from saving water in a city. This can lead to more constructive management of water and energy.

우리나라 조선산업의 지역산업연관 효과분석

본 연구는 한국은행이 2020년도에 발표한 ‘2015년도 지역산업연관표’를 사용하여 우리나라의 17개 지방자치단체에 속한 조선산업의 지역별 기본 경영현황을 분석하였다. 그리고 각 지역의 조선산업에서 발생한 투자 및 수출 활동이 전국 17개 지방자치단체의 165개 소분류 산업 부문에 미친 생산, 수입, 부가가치, 고용 파급효과를 분석하였다. 우리나라의 조선산업 생산활동은 경남, 울산, 전남, 부산, 전북 지역의 선박 수출기업을 중심으로 활발히 발생했다. 그 결과 조선산업의 투자 및 수출 활동에 따른 산업연관 파급효과는 우선 이들 지역 내에서 가장 크게 나타났다. 동시에 그 효과는 지역 간 산업연관 관계를 통하여 전국 각 지자체에 차별적으로 파급되었다. 지역 간 파급효과는 서비스 산업의 비중이 큰 서울과, 기계, 전기, 금속 산업이 발달한 경기도에서 더욱 크게 나타났다. 투자와 수출의 산업 간 파급효과는 33개 대분류 기준으로 볼 때, 조선산업이 속한 운송장비 산업은 물론, 그 밖에 금속, 임가공, 기계, 장비, 사업지원서비스, 도소매 산업을 중심으로 전국 전산업에 파급되었다. 우리나라의 조선산업은 국가 경제 특히 수출에서 차지하는 비중이 매우 높다. 본 연구의 결과는 글로벌 경기순환 및 국제무역 환경의 변화에 따른 국내 각 지역의 조선산업 및 그 연관산업 그리고 지역 고용 및 지역기업 지원정책 등에 유익한 자료로 사용될 수 있을 것이다.

Economic effects and greenhouse gas emissions of small-scale hydropower projects in Japan: evidence from a 47-prefecture interregional input–output analysis

This study investigates the economic effects (output, value added and employment) and greenhouse gas (GHG) emissions of small-scale hydropower [comprising construction and operation/maintenance (O&M) stages] using a 47-prefecture interregional input–output analysis. We evaluated both backward and income linkage effects using the Miyazawa model, and consequently demonstrated that: (1) with respect to output and employment, the backward linkage effects of the O&M stage are smaller than the construction stage, while the opposite is true for the income linkage effects. This may be mainly attributed to high value-added ratios of the O&M sectors, and implies relatively lower inputs and labor are required for running hydropower facilities than for constructing them. (2) Income linkage effects with respect to all the parameters are dispersed over several prefectures due partly to the income redistribution effect. (3) Analyses of life-cycle GHG emissions in physical terms reveal that the smaller the hydropower plant, the larger the GHG emissions per unit electricity production. This may be because more machinery must be used per unit electricity production at smaller plants, causing more emissions from both construction and maintenance works. (4) Assuming small-scale hydropower generation is conducted across 1602 sites in place of the general (including fossil fuel) power sector, Japan’s national GHG emissions are expected to be moderated by 0.145%, of which 55% is due to the technological effect and the remaining portion is through the electricity-saving effect from higher prices for small-scale hydropower.

An inquiry into water transfer network of the Yangtze River Economic Belt in China

As a typical region moving forward on green development demonstration belt, Yangtze River Economic Belt (YREB) is sensitive to profound conflict between coordination development and unbalanced water allocation. Uncovering water transfer network can help improving water resource coordination development from the perspective of water-trade nexus. An integrated framework by uniting the inter-regional input-output (IRIO) analysis and social network analysis (SNA) in this study can estimate not only the scale and structure of water trade pattern, but also the topological characteristic of water transfer network of YREB. Results show that the rank of production-based virtual water volume was roughly in the order of middle, lower and upper reaches except Jiangsu, while the rank of consumption-based virtual water volume was in the order of lower, middle and upper reaches. The provincial virtual water external dependence in YREB was not well consistent with the water resource endowment. Water transfer network was constructed on basis of the inter-provincial virtual water transfers between every two provinces inside YREB. Furthermore, the water transfer network assessment results illustrated the network structural form and revealed the network property and characteristics. Inside YREB, Shanghai, Jiangsu, Zhejiang, Anhui and Jiangxi were predominant in the water transfer network (from degree centrality), while Jiangxi, Hubei, Hunan and Anhui acted as the important medium and bridge (from betweenness centrality). The AFAF sector (Agriculture, Forestry, Animal husbandry and Fishery) and Industry sector of Jiangxi, and the Industry sector of Hubei and Jiangsu were the critical exporters in the network. Jiangsu received large amounts of virtual water from many good hubs and also transferred much to many good authorities when acted as bagmen in the network. Some provinces received large virtual water flow but provided few to others, such as Shanghai, and the AFAF sectors of most provinces transferred much to others. Thus, the research results would help understand the regional responsibility transfer in the hidden network linkages of interprovincial and intersectoral virtual water flows.

Economic and environmental impacts of agricultural and rural development projects in Japan: evidence from an interregional input–output analysis

Over the past centuries, Japan has developed a distinguished system for irrigated rice culture through cooperation of civil engineering and farming. This system has evolved into public works called the Agricultural Infrastructure Improvement and Rural Development Projects (AR and (2) major GHG-emitting input sectors included construction materials, oil/coal products, electricity, transport, as well as fossil-fuel consumptions by PW themselves. Furthermore, scenario analyses, in which PW sectors must suffer a budget cut, were conducted. The results suggested that the national government may well choose different budget allocations according to their objectives. If they aimed to minimize regional discrepancies in economic development, then lighter budget cuts should be imposed on remote regions. Meanwhile, if they aimed at minimizing the losses of National Total Outputs or maximizing the national GHG reduction, then they would face a trade-off, which stemmed from a strong proportional linkage between the outputs and the GHG emissions of PW. To moderate such a trade-off, technological structures of PW should be innovated, including: (1) increase energy efficiency (i.e., reduce consumption of electricity and fossil fuels); (2) reduce construction materials where possible or procure low emission-intensive materials; and (3) reduce wasted materials.

Microsimulation and interregional input–output modelling as tools for multi-level policy analysis

This article addresses the differentiated impacts of various sectors and branches in a multi-layer spatial system. The key question is whether in an interdependent spatial system – comprising a local, regional and national component – one or more core industries or sectors can be identified that may act as strategic handles for long-range sustainable development of a local economy. As a case study, the Cairngorms National Park in Scotland is used. In this area, policy makers – at different administrative levels – strongly emphasize the need for new sustainable economic development. We use a novel combination of stakeholder analysis (with household questionnaires) and multi-level interregional input–output analysis to identify which critical local key sectors are acting as carriers for local sustainability. The methodological vehicle employed in our study is based on microsimulation, as a tool to cope with limited data availability. This paper demonstrates how, even for small areas such as the Cairngorms National Park in Scotland, survey information combined with secondary data and existing input–output tables can be integrated into a useful policy toolbox for local sustainable development in a broader regional-national context.

Assessment of Local Key Sectors in a Triple-Layer Spatial System

This article addresses the differentiated impacts of various sectors and branches in a multi-layer regional system. As a case-study the Cairngorms National Park (CNP) in Scotland is used. In this area, policy makers ”at different administrative levels” strongly emphasize the need for new sustainable economic development. We use a novel combination of stakeholder analysis with household questionnaires and interregional input-output analysis to define the most important local key-sectors as carriers for local sustainability. The methodological vehicle employed is based on microsimulation. This paper demonstrates how, even for small areas such as the CNP in Scotland, survey information combined with secondary data and existing input-output tables can be integrated into a useful policy tool.

地域間廃棄物産業連関分析（IR-WIO）による家庭用生ごみ処理機のLCA

地域間廃棄物産業連関分析（IR-WIO）による家庭用生ごみ処理機のLCA

Public works, investments and their regional economic effects

This paper presents the possibility of planning Public Works and Investments in general, according to the economic effects caused to the economy of the regions, where they are constructed. The interregional Input-Output analysis and, in particular the multiregional input — output model is at the “core” of this research. With the use of trade coefficients and the creation of interregional multipliers, the possibility of estimation of the output for every region and the general economic changes, which can be caused by a public investment program, is given. It is also possible to estimate the changes in regional inequalities, as well as the regulation of this program, so that, economic development can also be successful, apart from regional development. This paper refers mainly to the general economic changes, which are brought about during the implementation of the works. These are usually the short-term effects, but there is the possibility for an analogous regulation and the estimation for the corresponding long-term effects.

Export-oriented Industrialization and Regional Development: A Case Study of Maquiladora Production in Yucatán, Mexico

Biles J. J. (2004) Export-oriented industrialization and regional development: a case study of maquiladora production in Yucatán, Mexico, Reg. Studies 38, 519–534. This study provides a critical appraisal of export-oriented industrialization (EOI), in the guise of maquiladora production, as a regional development strategy in the case of Yucatán, Mexico. Maquiladoras are export-oriented assembly plants characterized by the labour-intensive manufacture of imported components. Traditionally, these firms have located along the US–Mexico border. However, during the past decade maquiladora production has spread to other regions of Mexico. Perhaps the most dramatic shift in maquiladora location has been experienced by the state of Yucatán where export-oriented firms now account for one-third of all manufacturing jobs and more than two-thirds of all exports. Interregional input–output analysis reveals that maquiladora production has had a positive impact on economic growth and distribution of income in both urban and rural regions of the state. However, since the EOI strategy has failed to promote significant structural change in regional economies, long-term sustainable economic development in Yucatán is unlikely.

Waste Recycling and Interregional Relation

To analyze interregional transfer of wastes, it is necessary to make interregional economic input-output relation clearly. Generally, interregional input-output analysis has much more researches in view of quantity side than in view of cost-price side.The purpose of our research is theoretical analysis of waste recycling and interregional transfer of waste in view of cost-price side.Our research use linear joint production system introduced waste recycling technique. We assume that waste disposal sector of each region has alternative process which is “recycling inside” or “transfer outside”. Then we research sustainability of our system in terms of “choice of technique”.