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The Regional Input-Output Model: An Application to the Mexican Automotive Sector

Author

Listed:
  • Torre Cepeda Leonardo E.
  • Alvarado Jorge
  • Quiroga Miroslava

Abstract

We use the national Input-Output Matrix 2012 of INEGI and Flegg's approach to estimate four Regional Input-Output Matrices (RIOM) applying Banco de Mexico's regionalization. The RIOM are employed to evaluate the effects on gross output, value added and employment at the regional level resulting from two shocks: (a) the construction of a hypothetical automotive plant worth 1,000 million dollars; and (b) the production of 200,000 vehicles per year in that plant. The exercise reveals that: (i) the construction and the operation of the plant at full capacity have differentiated effects across regions and sectors on the studied variables, in both absolute and relative terms; (ii) the spillover effects resulting of both shocks within each region are concentrated in a limited number of sectors; and (iii) the north central region resulted to be the one receiving the largest relative benefits from both shocks.

Suggested Citation

  • Torre Cepeda Leonardo E. & Alvarado Jorge & Quiroga Miroslava, 2017. "The Regional Input-Output Model: An Application to the Mexican Automotive Sector," Working Papers 2017-12, Banco de México.
    • Handle: RePEc:bdm:wpaper:2017-12
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    File URL: https://www.banxico.org.mx/publicaciones-y-prensa/documentos-de-investigacion-del-banco-de-mexico/%7B38B13097-E3FB-1778-64AD-A3ED3EBF5962%7D.pdf
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    References listed on IDEAS

    as
    1. Andrea Bonfiglio & Francesco Chelli, 2008. "Assessing the Behaviour of Non-Survey Methods for Constructing Regional Input-Output Tables through a Monte Carlo Simulation," Economic Systems Research, Taylor & Francis Journals, vol. 20(3), pages 243-258.
    2. Anthony T. Flegg & Timo Tohmo, 2013. "Regional Input--Output Tables and the FLQ Formula: A Case Study of Finland," Regional Studies, Taylor & Francis Journals, vol. 47(5), pages 703-721, May.
    3. Rebecca Bess & Zoë O. Ambargis, 2011. "Input-Output Models for Impact Analysis:Suggestions for Practitioners Using RIMS II Multipliers," BEA Working Papers 0081, Bureau of Economic Analysis.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Input-Output Model; Regional Analysis; Multiplier Effects; Automotive Sector;
    All these keywords.

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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