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An Input-Output Analysis: Linkages versus Leakages

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  • Hugo Reis
  • Antonio Rua

Abstract

Resorting to input-output analysis, the relationships between production sectors are investigated. For such assessment, the distinction between imported and domestically supplied inputs, which has been disregarded so far in empirical analysis, is crucial. Besides an accurate measurement of domestic linkages, it also allows us to evaluate the importance of international trade in the production process. Moreover, the interaction between domestic linkages and leakages resulting from international trade can also be analysed. The study of such links improves our knowledge on the economic production structure and how it has evolved over time, which is essential for policy making. Using as a case study a small open European economy, the Portuguese one, we assess sectoral interdependence and trade effects for individual sectors as well as for the economy as a whole.

Suggested Citation

  • Hugo Reis & Antonio Rua, 2009. "An Input-Output Analysis: Linkages versus Leakages," International Economic Journal, Taylor & Francis Journals, vol. 23(4), pages 527-544.
    • Handle: RePEc:taf:intecj:v:23:y:2009:i:4:p:527-544
    DOI: 10.1080/10168730903372323
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    References listed on IDEAS

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    1. Clements, Benedict J., 1990. "On the decomposition and normalization of interindustry linkages," Economics Letters, Elsevier, vol. 33(4), pages 337-340, August.
    2. W. Baumol, 2001. "What Marshall Didn't Know: On the Twentieth Century's Contributions to Economics," Voprosy Ekonomiki, NP Voprosy Ekonomiki, vol. 2.
    3. Leroy P. Jones, 1976. "The Measurement of Hirschmanian Linkages," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 90(2), pages 323-333.
    4. Michel Boucher, 1976. "Some Further Results on the Linkage Hypothesis," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 90(2), pages 313-318.
    5. Dietzenbacher, Erik, 1992. "The measurement of interindustry linkages : Key sectors in the Netherlands," Economic Modelling, Elsevier, vol. 9(4), pages 419-437, October.
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    Cited by:

    1. Juhyun Oh & Dong Hee Suh, 2019. "The Industrial Linkages and Supply Effects of the U.S. R&D Sector: Comparison with OECD Countries," Social Sciences, MDPI, vol. 8(3), pages 1-10, March.
    2. Mariolis, Theodore & Leriou, Eirini & Soklis, George, 2019. "Dissecting the Input-Output Structure of the Greek Economy," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 72(4), pages 453-474.

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