In the table, the inputs utilized in the commodity production in the industry and the amount of output produced by the industry are displayed.Īn example of an I-O table for a two-sector economy is shown below: Input-Output table for a two-sector economy Sectors.The table has rows and columns for data input that may be used to assess the interdependencies of different sectors and industries in an economy.Input-output tables are used in I-O analysis to describe the supply chain of various economic sectors. This approach of macroeconomic analysis analyzes the interdependencies between various sectors of an economy by treating each sector's or industry's product as a commodity and a component of production. The I-O analysis approach was established by Wassily Leontief, a Soviet-American economist who won the Nobel Prize in Economics in 1973. It depicts how the outputs of one sector are used as inputs in another. This approach is frequently used to estimate the consequences of positive and negative economic shocks and to analyze the ripple effects across an economy. This type of macroeconomic research breaks into each sector and industry in terms of how they affect the economy. ![]() Input-output analysis (I-O) is a macroeconomics analytical approach that observes the interdependencies between different sectors and industries in a given economy.
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