Neumann's Model of an Expanding Economy

The classical (original) Neumann model is constructed under the following premises: An economy characterized by linear technology consists of industries, each of which has a finite number of production processes, i.e. several types of goods are produced, and joint activities of industries are allowed; production processes unfold in time, and the implementation of costs and […]

Key elements of cross-industry tables and cross-sectoral analysis

Cross-sectoral analysis is based on the use of statistical tables called “cross-sectoral”. The table of intersectoral balance describes the flows of goods and services between all sectors of the national economy during a fixed period of time (usually 1 year). The cross-sectoral balance sheet, expressed in terms of values, can be interpreted as a system […]

Determination of equilibrium output by iterative method

In the standard economic scheme, the subordination of the end and the means is established as: Facility (production)(reason) Purpose (consumption, final demand)(result) where the means (the end of the lowest level) is independent, and the end (the goal of the higher level) is dependent on variables. In the intersectoral balance, the opposite attitude is taken: […]

Determination of national income. Graphics

Let us consider how it is possible to display and study the main elements of the mechanism for determining national income, based on the principle of effective demand, with the help of graphs. Somewhat simplifying, the principle of effective demand refers to the provision according to which, for sufficiently short periods of time at which […]

Gross national disposable income account

The purpose of this account is to show how national disposable income is used at the economic level for final consumption and savings; at the sector level – like DHS, OSU and non-profit organizations serving DH, distribute their disposable income between final consumption expenditures and savings. The resource part of the account for the economy […]