Rural development through input-output modeling

Abstract

Input-output (I-O) models developed in the late 1930s and ever since have been applied extensively. Though the contribution of I-O models in depicting economic transactions was recognized early on, computational constraints have limited their use. This is mainly because of huge data requirements, difficulties in computational handling, and lack of software developed and adjusted for I-O analysis. Today, I-O analysis can be applied extensively in regional and local economies and can provide valuable information on growth and investment priorities, sectoral interrelationships, and policy impacts. I-O analysis has been employed in research on both agriculture and rural development to evaluate the importance of agricultural activities, the interdependence among agriculture and the rest of the economy, the intensity of the rate of growth, and the impacts of policy interventions.