Iranian Journal of Economic Research

APPLICATION OF EIGENVECTOR IN MEASUREMENT OF BACKWARD AND FORWARD LINKAGES

Authors

Ali Asghar Banooi 1
Mohammad Jolodari Mamaghani 2
Seyed Iman Azad 3

1 Associate Professor, Faculty of Economics, Allameh Tabatabai University

2 Professor, Faculty of Economics, Allameh Tabatabai University

3 Master of Economics, Institute of Humanities and Social Studies, University Jihad

Abstract
Using Conventional methods of Chenery-Watanabe and Rasmussen in inter industry linkages hae three limitations: Supply and demand sectors cannot be distinguished, distinction between balanced and unbalanced growth strategies are not clear and the measurement of inter industry linkages mainly depends on the size of sectoral intermediate demands. In this paper, we introduce an eigenvector method to overcome those limitations. We use the 22 aggregated sectors of the 1380 (2000) survey-based Input-Output table. The overall results show high correlation coefficients between the conventional methods. Furthermore,, we find that the eigenvector method is able to better identify those sectors which remains in the production process and therefore the key sectors.

Keywords

Input-Output Table
FORWARD AND BACKWARD LINKAGES
EIGENVALUE EIGENVECTOR METHOD

  • Receive Date 01 May 2016
  • First Publish Date 01 May 2016

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