Modelling the sectoral structure of the final output

Dobrescu, Emilian (2013): Modelling the sectoral structure of the final output.

Abstract

This paper examines the modelling complications that appear when some macroeconomic behavioral relationships interact with structural variables, even under a given A matrix. The main problem is concretized for the situation when, a) the final consumption, gross fixed capital formation, inventory changes, export, import (all of them at the market prices), and gross value added (at the production prices) are estimated as macro-indicators, and b) the output (at production prices) is determined on a disaggregated level. The so-called demand-side or supply-side approaches are possible; here, the supply-side approache is especially researched. With such a goal, the regression and linear weighted average (in the Fisher version)techniques are discussed as the main tools for estimating sectoral weights of the final output. For the linear weighted average method, the paper sketches – as a discussion proposal – a methodology for the optimal selection of the length (number of terms) of the moving average. As a primary database, the Romanian input-output tables for 1989–2009, aggregated into 10 sectors were used.

• Item Type: MPRA Paper
• Language: English
• Keywords: final output, sectoral structure, regression, moving average
• Subjects: C - Mathematical and Quantitative Methods > C3 - Multiple or Simultaneous Equation Models ; Multiple Variables > C32 - Time-Series Models ; Dynamic Quantile Regressions ; Dynamic Treatment Effect Models ; Diffusion Processes ; State Space Models; C - Mathematical and Quantitative Methods > C3 - Multiple or Simultaneous Equation Models ; Multiple Variables > C36 - Instrumental Variables (IV) Estimation; C - Mathematical and Quantitative Methods > C4 - Econometric and Statistical Methods: Special Topics > C43 - Index Numbers and Aggregation; C - Mathematical and Quantitative Methods > C6 - Mathematical Methods ; Programming Models ; Mathematical and Simulation Modeling > C67 - Input-Output Models

References

Akaike, H. (1973): "Information Theory and an Extension of the Maximum Likelihood Principle", in Petrov B.N. and Csaki F. (eds.), 2nd International Symposium on Information Theory, Budapest: Akadémiai Kiadó, pp. 267-281. (Reproduced in "Breakthroughs in Statistics", Vol. I, Foundations and Basic Theory, S. Kotz and N.L. Johnson eds., Springer-Verlag, New York, (1992) 610-624.

Akaike, H. (1974): “A New Look at the Statistical Model Identification”, IEEE Transactions on Automatic Control, Vol. AC-19, No. 6, December pp. 716-723.

Burnham, K. P. and D. R. Anderson (2002): “Model Selection and Multimodel Inference: A Practical Information-Theoretical Approach”, Second Edition, New York: Springer-Verlag, 488 pp.

Burnham, K. P. and D. R. Anderson (2004): “Multimodel Inference: Understanding AIC and BIC in Model Selection”, Sociological Methods & Research, November 2004 33: 261-304, 2004 Sage Publications; http://www.sortie-nd.org/lme/Statistical20Papers/Burnham_and_Anderson_2004_Multimodel_Inference.pdf. (Accessed 14 march 2013)

Claeskens, G. and N. L. Hjort (2008): “Model Selection and Model Averaging”,Cambridge Series in Statistical and Probabilistic Mathematics, Cambridge University Press, 312 pp.

Dobrescu, E. (2006): “Integration of Macroeconomic Behavioural Relationships and the Input-Output Block (Romanian Modelling Experience)”, Paper presented at the International Conference on Policy Modelling (Ecomod 2006), Hong Kong, June 28-30.

Dobrescu, E. (2009): “Measuring the Interaction of Structural Changes with Inflation”, Romanian Journal of Economic Forecasting, Supplement 2009, 96 pgs.

Dobrescu, E., Gaftea, V., and Scutaru, C. (2010): “Using the Leontief Matrix to Estimate the Impact of Investments Upon the Global Output”, Romanian Journal of Economic Forecasting, Vol. 13, No. 2, pp. 176-187.

Fisher Irving, 1937, Note on a Short-Cut Method for Calculating Distributed Lags, Bulletin de l’Institut International de Statistique, 29, Part 3, The Hague, 323-327. Cited in Maddala, G.S. (2001): „Introduction to Econometrics”, 3rd Edition, Wiley, p. 397-398, and in Jula, D. and N-M Jula, 2012.

Gagne, P. and Dayton C. M. (2002): “Best Regression Model Using Information Criteria”, Journal of Modern Applied Statistical Methods, Fall, Vol. 1, No. 2, pp.279-488; http://education.umd.edu/EDMS/fac/Dayton/Gagne.pdf. (Accessed 14 march 2013).

Hannan E. J., and B. G. Quinn (1979): "The Determination of the Order of an Autoregression", Journal of the Royal Statistical Society, Series B (Methodological), 41(2), pp. 190–195.

INSSE—TEMPO (2012) Input–output tables. http://statistici.insse.ro/shop/?lang=en

Jula, D. and N-M., Jula (2012): “Prognoza economica, Editura Mustang, Bucharest, 268 pp.

Leontief, W. (1970): „Analiza Input-Output”, Editura Stiintifica, Bucharest, 275 pgs.