An optimal quadratic equilibrium model based on Israel's multiregional input-output tables

Aliza Fleischer*, Hovav Talpz, Daniel Freeman

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

2 Scopus citations

Abstract

This paper develops a quadratic multiregional input-output (QMRIO) model which allows for evaluation of the effects of economic policy on various geographical regions of an economy. The model has a quadratic target function representing society's welfare. The coefficients of the target function are acquired from estimates of the supply and demand systems. In the current application, the model's parameters are derived from the multiregional input-output tables of the Israeli economic system. The interregional impact of a tax reduction, aimed at the population of the Southern Negev, was studied, and a welfare cost-benefit analysis carried out. It was shown that the resulting welfare for consumers in the Southern Negev is increased, while the opposite occurs for consumers in all other regions of the country. Coincidentally, the producers' welfare is increased nationwide.

Original languageAmerican English
Pages (from-to)195-200
Number of pages6
JournalSocio-Economic Planning Sciences
Volume22
Issue number5
DOIs
StatePublished - 1988
Externally publishedYes

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