Inter‐industry analysis in the Korean flow‐of‐funds accounts

1 Background Flow-of-funds (FOF) accounts indicate the interrelations between the various institutional sectors of each nation, including overseas sectors, in a systematic and coherent manner. The FOF system adopts a quadruple-entry system proposed by Copeland (1952), wherein each transaction is recorded with a double entry. On the other hand, the input–output (I–O) table, which indicates production in the real economy, is composed of various industries. Transactions of production always involve funds transactions. Klein (2003) indicated a need for the “from-whom-to-whom” basis FOF table’s construction, which corresponds to tables and techniques of I–O analysis. However, it is difficult to link the I–O table and FOF accounts. The economic agents in the I–O table are separated into hundreds of industries. Though the FOF accounts comprise all Abstract