Difference between revisions of "Final Demand"
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== Formula == | == Formula == | ||
| + | Final demand might be denoted as a vector or matrix (typically using <math>F</math> or <math>Y</math>). | ||
=== Single Region Case === | === Single Region Case === | ||
| − | In the single region case final demand is a vector | + | In the single region case final demand is a vector and depicted as a column next to the [[Input-Output Matrix]]. |
=== Multi-Region Case === | === Multi-Region Case === | ||
| Line 13: | Line 14: | ||
\begin{align} | \begin{align} | ||
Y^{pq}_{i} = | Y^{pq}_{i} = | ||
| − | \begin{ | + | \begin{bmatrix} |
Y_{1,1} & Y_{1,2} & \cdots & Y_{1,k} \\ | Y_{1,1} & Y_{1,2} & \cdots & Y_{1,k} \\ | ||
Y_{2,1} & Y_{2,2} & \cdots & Y_{2,k} \\ | Y_{2,1} & Y_{2,2} & \cdots & Y_{2,k} \\ | ||
\vdots & \vdots & \ddots & \vdots \\ | \vdots & \vdots & \ddots & \vdots \\ | ||
Y_{k,1} & Y_{k,2} & \cdots & Y_{k,k} | Y_{k,1} & Y_{k,2} & \cdots & Y_{k,k} | ||
| − | \end{ | + | \end{bmatrix} |
\end{align} | \end{align} | ||
</math> | </math> | ||
| Line 25: | Line 26: | ||
== Usage == | == Usage == | ||
The precise nature of final demand depends on the economic system modeled and may include: | The precise nature of final demand depends on the economic system modeled and may include: | ||
| − | * Consumption by | + | * Consumption by Households |
| − | * Government | + | * Government Expenditures |
* Inventories | * Inventories | ||
| − | * [[Capital Formation]] | + | * [[Capital Formation]] (Investment) |
| + | * Foreign Exports | ||
| Line 37: | Line 39: | ||
== Code == | == Code == | ||
| − | * [https://github.com/konstantinstadler/pymrio pymrio]] | + | * [https://github.com/konstantinstadler/pymrio pymrio] |
| + | |||
| + | == Further Resources == | ||
| + | * [https://www.openriskacademy.com/course/view.php?id=70 Crash Course on Input-Output Model Mathematics] | ||
| + | * [https://www.openriskacademy.com/course/view.php?id=64 Introduction to Input-Output Models using Python] | ||
== References == | == References == | ||
Latest revision as of 12:42, 7 February 2024
Contents
Definition
Final Demand or final consumption in the context of an Input-Output Model denotes the ultimate destination of goods and services used up by individual households or the community to satisfy their individual or collective needs or wants.
Formula
Final demand might be denoted as a vector or matrix (typically using 
or 
).
Single Region Case
In the single region case final demand is a vector and depicted as a column next to the Input-Output Matrix.
Multi-Region Case
In the multi-region case, the global final demand a tensor, usually represented as a matrix of vectors and denoted as "Y":
with the final demand vector of domestic (country q) production in the main diagonal and direct imports to final demand from country p captured by off-diagonal vectors.
Usage
The precise nature of final demand depends on the economic system modeled and may include:
- Consumption by Households
- Government Expenditures
- Inventories
- Capital Formation (Investment)
- Foreign Exports
Adjusting final demand is and exploring economic implications is a core element of Input-Output Analysis.
Notes
The sum of final demand equals to GDP (=sum of final sales)
Code
Further Resources
References
- Eurostat SUT Manual
