Welfare payments and migration in a nonlinear,extended input-output model with an application to Scotland

This paper examines an extended input-output model that includes a migration mechanism and a locally funded welfare benefit regime. The model is developed to include two regions. Two different solution methods of the model are discussed, one involving the introduction of nonlinearities into the input-output framework. The results of the two solutions are compared using test data for a one-region formulation, and data for a two-region division of Scotland. The regional impacts of varying unemployment benefits differentially are assessed, and a range of impacts of economic and demographic regional injections presented.     

Interregional labor migration and information flows

A model of interregional labor migration is developed that incorporates a complex system of information concerning migration and employment opportunities, as well as a heterogeneous population in which groups of workers differ in their assumed levels of skill, attitudes toward risk, and willingness to move. "Three channels are examined: interpersonal communication, general source information, and specific source information targeted at unemployed workers. In this process, trajectories of welfare levels (composed of wage plus nonwage benefits), information flows, vacancy and unemployment levels are generated for different worker and job types, regional aggregates, and the system as a whole. The behavior of the model is examined by means of numerical simulations and sensitivity analyses."     

Interregional gross migration and structural changes in local industries

"In this paper the impacts of structural changes in local industries on interregional gross migration in Japan for 1974-85 are empirically examined. Structural changes in local industries, which are represented by a simple index of local employment growth dispersion across sectors, induce interregional migration, as well as intraregional migration. The estimation results with pooled data support this hypothesis. The impacts of structural changes in local industries are different across gross migration flows (rural-urban, urban-rural, urban-urban, and rural-rural migration), as are the impacts of other determinants of migration such as earnings differentials, aggregate employment growth, national unemployment, distance, and age structure."     

Interregional migration models with source and interaction information

"Information flows in models of migration are emphasized. In particular, migrants are assumed to react to two types of information about job vacancies. 'Interaction information' may be defined as interpersonal communication between recent migrants and their former neighbors or friends, and 'source information' represents a direct flow of information from employers or agencies to individuals. Models are developed that investigate the effects of various communication rates and information retention levels on vacancy rates and labor-force population trajectories. It is found that attempts by planners to reduce regional inequities in vacancy rates through controlled advertising may be successful, but at the possible cost of increasing temporal fluctuations of regional vacancy rates."     

The dynamic variable input-output model: An advancement from the Leontief dynamic input-output model

The Dynamic Variable Input-Output (VIO) model extends the static single regional version of the Multiregional Variable Input-Output (MRVIO) model which is a general equilibrium model applied to the Leontief Input-Output model. The Dynamic VIO model which incorporates time dimensions can describe the real situation more accurately while maintaining the computational simplicity. Under the model, the investment expenditures are directly linked with the profit maximizing behavior of firms. Both technical coefficients and capital stock requirement coefficients include price terms, and they become variable instead of being fixed.  By gathering investment terms together instead of separating them as is done in Leontief's Dynamic output equation, we not only preserve the consistency between time-specific dynamic multipliers and total dynamic multipliers, but also get over the shortcoming of the negative occurences of the Leontief's multiplier matrices, particularly the impact (initial period) multiplier matrix.  Using the 15 sector interindustry transaction table derived from the 1987 U.S. benchmark input-output table, we estimate dynamic output and income multipliers for all industries.  Empirical results show that, over all industries, dynamic total multipliers of the Dynamic VIO model are larger than static multipliers of the static Household Interactive VIO (HIVIO) model. Static multipliers of the static Household Interactive VIO (HIVIO) model which lie between Leontief's static type I and type II multipliers are exactly the same as the impact (initial period) multiplier of the Dynamic VIO model. Similarly, dynamic total multipliers of the Dynamic VIO model are larger than those of the Leontief static type I and type II multipliers, and multipliers of the Leontief dynamic (in nested form) IO model. Thereby, the study demonstrates that the static HIVIO model and the Leontief IO models (both static and dynamic (in nested form)) underestimate actual impacts. The study also shows that the sum of all time-specific multipliers of the dynamic VIO model equals to dynamic total multiplier; thus, consistency is ensured in the dynamic multipliers of the Dynamic VIO model. The multipliers of the dynamic VIO model vary among different industries, and they decrease as the number of time lags increase with the initial period impact as the largest. The percent distributions of multipliers over time periods reveal that ripple effects of spending are mostly recognized during the first four periods. The dynamic multipliers of the Dynamic VIO model are useful information in evaluating the long-term economic effects of spending. Received: August 1996/Accepted: March 1999     

Interregional migration,self-selection and the returns to education in Brazil

During the last decade Brazil has seen an astonishing reversal in the original north-east-to-south-east direction of migration. Within a framework of human capital and self-selection theory we try to identify the individual characteristics and motivations linked to the migration pattern. The overall results of this procedure suggest that there is a key difference between NE T{\Rightarrow } SE movers and SE T{\Rightarrow } NE movers. (1) SE T{\Rightarrow } NE movers were adverse self-selected in terms of observable education characteristics. (2) No self-selection could be observed among migrants in the NE T{\Rightarrow } SE direction. In general the North-East seems less attractive to highly skilled people. (3) Labor market segmentation with respect to sector occupation is likely. (4) There are clear differences in income determinants between movers and non movers. The majority of migrants except for migrants with higher education cannot expect to realize a return to education comparable to the average in the region of departure or destination. However, in the context of the Borjas selection model the returns to education analysis would predict a different pattern of migrant selectivity than the one observed in Brazil. Apart from soft characteristics connected to the regions we believe, that the large share of the non formal labor market is likely to indicate a surplus labor leading to a migration pattern different than expected from selection theory.     

The choice of an input-output table embedded in regional econometric input-output models

In this paper, we investigate the role of input-output data sources in regional econometric input-output models. While there has been a great deal of experimentation focused on the accuracy of alternative methods for estimating regional inputoutput coefficients, little attention has been directed to the role of accuracy when the input-output system is nested within a broader accounting framework. The issues of accuracy were considered in two contexts, forecasting and impact analysis focusing on a model developed for the Chicago region. We experimented with three input-output data sources: observed regional data, national input-output, and randomly generated inputoutput coefficients. The effects of different sources of input-output data on regional econometric input-output models revealed that there are significant differences in results obtained in both forecast and impact analyses. The adjustment processes inherent in the econometric input-output system did not mask the differences imbedded in input-output tables derived from different data sources. Since applications of these types of models involve both impact and forecasting exercises, there should be strong motivation for basing the syste on the most accurate set of input-output accounts.     

Interregional labour migration and real wage disparities: Evidence from Japan

This paper empirically tests the relationships between interregional labour migration and regional real wages based on a multi-region economic geography model, which describes bilateral migration flows. In particular, this paper highlights real wage disparities in the migration analysis. Our empirical methodology contains two steps. First, we structurally estimate a gravity model using manufacturing workers’ migration flows across the 47 Japanese prefectures. Second, using the estimates of the structural parameters, we examine the impact of the real wage on the net migration rate. We find that migrants respond to real wage disparities, rather than to nominal wage disparities.     

A continuous Leontief dynamic input-output model

This paper extends the Leontief dynamic input-output model by incorporating continuous lags, capacity constraints, excess capacity and limits on disinvestment in each sector. These extensions result in phase changes, where sectors discretely change from one set of conditions to another. The resulting system of equations is solved by numerical methods and applied to the U.S. economy. Projections for the 1952 to 1962 period are compared with actual levels.     

Dynamic multipliers for a regional input-output model

Regional multiplier is a very useful and popular tool in economic study of a region. However, conventional regional multiplier derived from a static input-output model fails to provide time path of the impact over period. In many cases, it restricts the impact within a year period. To alleviate the problem, this paper introduces a regional dynamic multiplier which makes the impact to spread out over period. In the absence of the technical change, each period multiplier added up to the static multiplier. Utilizing Oklahoma data, the paper estimates the capital coefficients and the dynamic multipliers of Oklahoma regional economy. Finally, it provides a comparative study of dynamic multipliers for various industries.The author is grateful to Professor Wassily Leontief who generously sent him the U.S. Capital Coefficient data and to the referees for their valuable suggestions. This research was supported in part by the Center for Economic and Management Research, the University of Oklahoma. Mr. Chun K. Chang and Mr. Ui Nam Choi provided computer assistance and data gathering works. The final revision was done at Harvard University.     

Single-place alternative opportunities in an economic model of migration

Inspired by Samuel Stouffer's work on alternative opportunities in the gravity model of migration, Levy and Wadycki developed a specification for incorporating this concept in an economic model of migration. Subsequent testing has confirmed the statistical relevance of the alternative opportunity concept across a number of countries and time periods.The present paper refines the definition of alternative opportunities so that the best alternative variables all come from the same location. In the original formulation, the best alternative variable is the optimum value within a circle determined by the origin and destination points. That formulation permits different locations to provide the best alternatives for the economic variables in the model. The single-place approach of the present paper is more consistent with the migrant's utility calculus which determines a single best alternative location. Using United States data for two time periods, we find that the empirical results support this new formulation.Research for this paper was supported by a University of Illinois Sabbatical Leave and by the services of the University of Illinois at Chicago Computer Center.     

Modeling microbial diversity in anaerobic digestion through an extended ADM1 model

The anaerobic digestion process comprises a whole network of sequential and parallel reactions, of both biochemical and physicochemical nature. Mathematical models, aiming at understanding and optimization of the anaerobic digestion process, describe these reactions in a structured way, the IWA Anaerobic Digestion Model No. 1 (ADM1) being the most well established example. While these models distinguish between different microorganisms involved in different reactions, to our knowledge they all neglect species diversity between organisms with the same function, i.e. performing the same reaction. Nevertheless, available experimental evidence suggests that the structure and properties of a microbial community may be influenced by process operation and on their turn also determine the reactor functioning. In order to adequately describe these phenomena, mathematical models need to consider the underlying microbial diversity. This is demonstrated in this contribution by extending the ADM1 to describe microbial diversity between organisms of the same functional group. The resulting model has been compared with the traditional ADM1 in describing experimental data of a pilot-scale hybrid Upflow Anaerobic Sludge Filter Bed (UASFB) reactor, as well as in a more detailed simulation study. The presented model is further shown useful in assessing the relationship between reactor performance and microbial community structure in mesophilic CSTRs seeded with slaughterhouse wastewater when facing increasing levels of ammonia.     

The Model Reference Adaptive System in the dynamic input-output model

In this paper we explore the use of the Model Reference Adaptive System (MRAS) in a dynamic socio-economic enviroment. We prove the existence of adaptation laws which ensure that the error equation in MRAS for a dynamic input-output model is asymptotically stable. The resulting theorems are appraised through some numerical simulations.     

Regionalizing national projections with a multiregional input-output model linked to a demographic model

Multiregional input-output has long been recognized as a tool that provides an appropriate framework for considering regional growth and development questions, but implementation problems have impeded utilization of this methodology. This paper discusses how several of these problems have been partially overcome with a multiregional economic-demographic model of the Southwest. The model is used to regionalize projections from a national dynamic input-output model.     

Dynamic variable input-output (VIO) model and price-sensitive dynamic multipliers

The conventional multipliers of macro economic models, econometric models, Computable General Equilibrium (CGE) models with fixed industrial purchase I/O coefficients, and Leontief Input-Output (I/O) models are price-insensitive. On the other hand, the multipliers of the Dynamic Variable Input-Output (VIO) model have the advantage of being price-sensitive. The Dynamic VIO model extends the static single regional version of the Multi-Regional Variable Input-Output (MRVIO) model, which is a hybrid of Computable General Equilibrium (CGE) model and the further developed Leontief's dynamic Input-Output (I/O) model. The Dynamic VIO model, which incorporates time dimensions, can describe the actual situations more accurately while maintaining computational simplicity. Under this model, both technical coefficients and capital stock requirement coefficients include price terms, and they become variable instead of being fixed. By using the 15 sector industrial transaction table derived from the 1987 U.S. Benchmark input-output table, and by assuming constant technology during the years of 1987–1991, I estimate the dynamic equilibrium price changes due to wage rate changes and measure the effects of the relative equilibrium price changes on output, income, and employment multipliers that are spread over the time periods. The dynamic multipliers of the Dynamic VIO model include both pure spending effect and substitution effect in the presence of input cost changes such as wage rate changes. The substitution effect is the relative equilibrium price change effect, and it occurs due to the substituting behavior of firms and consumers seeking cheaper products. Actual economic impacts that we observe in a given time period, as the result of government spendings, are the total cumulative effects of the current and previous time periods. The empirical analysis shows that wage rate changes during 1987 through 1991 give statistically significant effect on mean equilibrium price changes for the total of five years and for each time period except the immediate time period (lag 0) under 1% level of significance. As for the immediate time period (lag 0), mean equilibrium prices are same between the two groups of wage rate-change and no-wage rate-change cases. Nevertheless, equilibrium price changes affect output, income, and employment multipliers significantly. Hypothesis tests show that significant differences exist in mean output, income, and employment multipliers between the two groups of wage rate-change and no-wage rate-change cases for each time lag (1–4) and for the total of five time lags. The dependent t-test is applied to the paired data. The study concludes that substitution effects do alter mean output, income, and employment multipliers for each time lag (1–4) and for the total of all five time lags under 1% level of significance. Furthermore, the study finds that mean multipliers of output, income, and employment under the wage rate-change case are smaller than those under the no-wage rate-change case. For the immediate time period (lag 0), the significance level should be increased to 2%, 13%, and 5%, respectively, to support the claim that mean multipliers of output, income, and employment are different between the two groups, and that mean multipliers of output, income, and employment of the wage rate-change case are smaller than those of the no-wage-rate change case. These strong empirical results demonstrate the capability and usefulness of the Dynamic VIO model for measuring government spending effects in terms of price-sensitive dynamic multipliers. Received: May 2000 / Accepted: August 2003 I am grateful to Roger R. Stough and three anonymous referees for valuable comments and suggestions. If there is any error, it is solely mine.