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Integrating A Household Demand System In The Input-Output Framework. Methodological Aspects And Modelling Implications

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  • Ignazio Mongelli
  • Frederik Neuwahl
  • Jose Rueda-Cantuche

Abstract

In this paper we argue that an accurate representation of household consumption behaviour is central to the analysis and comparison of policy interventions addressing sustainable consumption. Therefore, we propose to extend an input-output model with a specific household consumption model, at the core of which is a system of equations explaining the allocation of the households' overall expenditure across different purposes, such as buying food, the consumption of fuel for heating or electricity for cooling, education of children or travelling in terms of total expenditure and relative prices. This paper shows that the integration of a specific module for household consumption in a standard input-output model is an improvement for the analysis of the policies aimed at altering consumer behaviour.

Suggested Citation

  • Ignazio Mongelli & Frederik Neuwahl & Jose Rueda-Cantuche, 2010. "Integrating A Household Demand System In The Input-Output Framework. Methodological Aspects And Modelling Implications," Economic Systems Research, Taylor & Francis Journals, vol. 22(3), pages 201-222.
    • Handle: RePEc:taf:ecsysr:v:22:y:2010:i:3:p:201-222
    DOI: 10.1080/09535314.2010.501428
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    References listed on IDEAS

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    1. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685, December.
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    Cited by:

    1. Dai, Hancheng & Masui, Toshihiko & Matsuoka, Yuzuru & Fujimori, Shinichiro, 2012. "The impacts of China’s household consumption expenditure patterns on energy demand and carbon emissions towards 2050," Energy Policy, Elsevier, vol. 50(C), pages 736-750.
    2. Omar Blanco & Simone Alfarano, 2016. "Granularity of the business cycle fluctuations: The Spanish case," Working Papers 2016/25, Economics Department, Universitat Jaume I, Castellón (Spain).
    3. Brizga, Janis & Feng, Kuishuang & Hubacek, Klaus, 2017. "Household carbon footprints in the Baltic States: A global multi-regional input–output analysis from 1995 to 2011," Applied Energy, Elsevier, vol. 189(C), pages 780-788.
    4. Bjelle, Eivind Lekve & Wiebe, Kirsten S. & Többen, Johannes & Tisserant, Alexandre & Ivanova, Diana & Vita, Gibran & Wood, Richard, 2021. "Future changes in consumption: The income effect on greenhouse gas emissions," Energy Economics, Elsevier, vol. 95(C).
    5. Cordier, Mateo & Uehara, Takuro & Weih, Jeffrey & Hamaide, Bertrand, 2017. "An Input-output Economic Model Integrated Within a System Dynamics Ecological Model: Feedback Loop Methodology Applied to Fish Nursery Restoration," Ecological Economics, Elsevier, vol. 140(C), pages 46-57.
    6. Mair, Simon & Druckman, Angela & Jackson, Tim, 2019. "Higher Wages for Sustainable Development? Employment and Carbon Effects of Paying a Living Wage in Global Apparel Supply Chains," Ecological Economics, Elsevier, vol. 159(C), pages 11-23.
    7. Rocchi, Paola & Serrano, Mònica & Roca, Jordi, 2014. "The reform of the European energy tax directive: Exploring potential economic impacts in the EU27," Energy Policy, Elsevier, vol. 75(C), pages 341-353.

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