Design for Commodity-by-Industry Interregional Input-Outpu–

In this paper we do not attempt to develop an interregional model. Rather, we propose a mathematical structure of computational framework with which a family of interregional input-output models can be constructed. This family of interregional input-output models encompasses the well-known class of static models that are used to analyse the propagation of demand throughout an economic system disaggregated both regionally and industrially. Among the most familiar models of this class are the national-intranational model of Leontief [8], the Leontief-Strout gravity model [9], and those associated with CheneFY [2] , Isard [7], and Moses [11] . In our view, it is useful to consider an interregional model as a disaggregation of a national model, rather than as a formal linking of individual regional models. Many of the data required to construct input-output accounts are available at the national level, but not at the subnationallevel. This is particularly true of interregional trade data and some elements on the income side of the national income and expenditure accounts. The approach of disaggregation does not require estimation of the complete network of interregional trade flows nor allocation of all income to each region. The national inputoutput accounting framework, which serves as the starting point in the development of the interregional input-output model framework proposed in this paper, is the commodityby-industry accounting framework associated with Statistics Canada input-output models [3; 12]. The essence of the accounting framework is the recognition of two spaces: an institutional space where institutions are grouped into industries, households, governments, and a foreign sector; and a transaction or commodity space that distinguishes intermediate flows or flows of produced goods and primary flows or factor inputs. The accounts show the production of commodities by industries; they also show foreign imports and the use of both as intermediate inputs