Iranian Journal of Economic Research

A Quantitative Analysis of Sectoral Interrelationship in the Framework of the Structural Path Analysis

Document Type : Research Paper

Authors

Ali Asghar Banouei 1
Mohammad Jelowdari Mamaghani 2
Yaghoob Andayesh 3
Hassan Alizadeh Asl 4
Mina Mahmoodi 4

1 Assistant Professor , Faculty of Economics, University of Allameh Tabatabaie

2 Associate Professor , Faculty of Economics, University of Allameh Tabatabaie

3 Graduate Students, Faculty of Economics, University of Allameh Tabatabaie

4 Senior Economist, Management and Plan Organization

Abstract
In this paper we analyze quantitatively the interrelationship between three major sectors of  the Iranian economy, viz. agriculture, industry and services. We apply two approaches of Social Accounting Matrix (SAM), Namely; conventional multiplier and decomposed multiplier based on structural path analysis. The former illustrates the global effect of one account on the other without revealing the complexities of the socio-economic production processes. The latter depicts different paths as well as loops, circuits and network that have been generated in each path, thereby providing a wide scope to socio–economic analysis. In our study, we have used the Iran's 1996 SAM. The overall results suggest that in order to increase production, mere economic policies are not sufficient and therefore, supplementary socio –economic policies are required.  

Keywords

Social Accounting Matrix (SAM)
Accounting Multiplier
Elementary Path
Loop
Circuit
Arc
Structural Path Analysis (SPA)

  • Receive Date 14 May 2016
  • First Publish Date 14 May 2016

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