Difference between revisions of "Output Multiplier"
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Revision as of 14:22, 18 September 2023
Definition
An Output-to-Output Multiplier indicates how total production will change as Final Demand is changed in any one sector of the economy.
The output multiplier for sector j is the sum of column j of the Leontief Inverse Matrix. This output multiplier measures the amount of output generated by a $1 change in final demand for the output of the jth sector.[1]
Formula
If we represent the elements of the Leontief Inverse Matrix 
as 
, then the output multiplier is defined as the column sum:
Further Resources
References
- ↑ R.E. Miller and P.D. Blair, Input-Output Analysis: Foundations and Extensions, Second Edition, Cambridge University Press, 2009
