Assessment of inter-sectoral effects of stimulating the demand for the produce of individual sectors of Ukraine's economy

Developing forecast and program documents on encouraging sectoral development requires assessment of the influence of the corresponding measures on adjacent economic sectors. The article proposes a model for the analysis of multiplicative effects of encouraging the sectoral development, which emerge due to the inter-sectoral ties. The model is based on Leontief's inter-sectoral balance method, structural relationships of the technological structure of outputs and other proportions of input-output tables. As a result of the author's model based calculations, the influence of the development of various sectors on the macroeconomic dynamics has been assessed (with regard of the international ties). Growth in the economic sectors forms multiplying effects by affecting the macroeconomic dynamics through encouraging the domestic demand for the produce of adjacent sectors and private and public consumption. The positive influence on the dynamics of economic growth is formed in case of the satisfaction of intermediate and final demand at the expense of domestic production, and the negative one - at the expense of imports. The expense satisfied at the expense of domestic production creates new waves of demand for the produce of intermediate and final consumption by supporting business activities in the economic system during a long time interval. The cumulative effect of multiplication, which consists of direct, inter-sectoral and induced effects depends on the technological structure of output and consumption structure of the national economy, and allows to take account of the flows of goods and services consumption, as well as inter-sectoral and investment flows in the course of the influence of exogenous fluctuations on the sectoral development. The assessment of the effects of increased value added in the economy with regard of direct and inter-sectoral influence is considered on the example of agriculture, metallurgy, machine building and construction. Calculations suggests that the greatest positive effect for economic growth in Ukraine is associated with encouraging the agriculture, which is followed by the lowest, among the analyzed sectors, increase in imports. With the insignificant direct influence of the metallurgy, the GDP increase is affected by the powerful inter-sectoral ties of the mining and metallurgy sector. The main risk of encouraging the growth of metallurgy input is the growth of imports caused by the large share of the primary resources imports in the structure of the sector's indirect consumption. Creation of additional demand for the produce of machine building is followed by strong inter-sectoral effects; however, that growth potential is not fully realized due to the large share of imports in the sector's intermediate consumption. Potential of the action of inter-sectoral ties in the construction should be more efficiently realized at the expense of import substitution, because, with the sector's existing technological structure, the GDP losses incurred at the expense of the imports of intermediate use produce by the construction sector partly eat out the positive effects.