Basic, Demand-Driven IO Quantity Models

This chapter introduces the single region, the interregional and the multi-regional input–output (IO) table and discusses the differences between the three IO models based on these three sets of data. It is concluded that it is crucial to understand that the centrally important intermediate input coefficients, in fact, represent the product of a technical coefficient and, respectively, an intra-regional self-sufficiency coefficient in case of the single-region IO model and an interregional import coefficient in case of both multi-regional models. It is, furthermore, concluded that it is mostly better to work with normalized income, employment, emissions, energy use and other impact multipliers than with the ordinary multipliers of exogenous final demand. Finally, the chapter discusses the nature of interregional spillover and feedback effects and how both are underestimated by the single-region model.