State intermediate demand breakouts
How/can one measure the share of a states intermediate demand that is induced production arising from purchases in the state of commodities produced elsewhere in the US?
In other words, for a commodity purchased in a state (a car, say) that was manufactured elsewhere in the US, is there a way to determine how much, if any, was induced as intermediate demand in the state by the production of the commodity (e.g., the car) elsewhere in the US?
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Without trade flow data you'll have to make assumptions: (by induced, I assume you mean caused by - rather than "induced multiplier") 1) Create the ratio (for Car assembly commodity) US Total Final Demand/US Output 2) Calculate (for car assembly commodity) US Output - State Output 3) Apply 1) times 2) (this prevents double counting production) 4) Apply the result of 3) to a National model 5) Create the ratios (for all sectors) State Output/US Output 6) Apply the ratios from 5) to the total impacts from 4) The result is the state's economic activity caused by US production (outside of the state) of cars. The assumption is that the state provides inputs into that national production process based on it's national market share of goods and services. The multi-regional analysis that will be part of version 3 would make this much simpler. -
Without trade flow data you'll have to make assumptions: (by induced, I assume you mean caused by - rather than "induced multiplier") 1) Create the ratio (for Car assembly commodity) US Total Final Demand/US Output 2) Calculate (for car assembly commodity) US Output - State Output 3) Apply 1) times 2) (this prevents double counting production) 4) Apply the result of 3) to a National model 5) Create the ratios (for all sectors) State Output/US Output 6) Apply the ratios from 5) to the total impacts from 4) The result is the state's economic activity caused by US production (outside of the state) of cars. The assumption is that the state provides inputs into that national production process based on it's national market share of goods and services. The multi-regional analysis that will be part of version 3 would make this much simpler.
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