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network), FlexNIEMO (to relax the standard I-O assumption of fixed production
coefficients), and adding induced impacts to indirect impacts in interregional
trade analysis.
4.1
Background to Multiregional I-O Construction
Many economists and planners are interested in evaluating the socioeconomic
impacts of various disruptions. Occasionally, they use geographically detailed
input-output (I-O) models. Isard demonstrated as early as 1951 that traditional
(national) I-O models are inadequate because they cannot capture the effects of
linkages and interactions among regions. To examine the full (short-term) impacts
of unexpected events, such as terrorist attacks or natural disasters, on the
U.S. economy, the economic links among states should be considered. Multire-
gional input output models (MRIOs) include interregional trade tables and avoid
some of the problems associated with excessive aggregation. Building an opera-
tional MRIO for all the states of the U.S.,
1
however, requires highly detailed
interstate shipments data.
Although Chenery (
1953
) and Moses (
1955
) had formulated a relatively
simplified MRIO framework in response to the earlier discussions by Isard
(
1951
), data problems persisted and have stymied most applications. The
non-existence and/or rarity of useful interregional trade data are the most problem-
atic issues. Intraregional and interregional data must be comparable and compati-
ble, yet the currently available shipments data between states are only sporadically
available and difficult to use.
It is not surprising, then, that few MRIO models have been constructed or widely
used in the U.S. The best known are the 1963 U.S. data sets for 51 regions and
79 sectors published in Polenske (
1980
) and the 1977 U.S. data sets for 51 regions
and 120 sectors released by Jack Faucett Associates (
1983
), then updated by various
Boston College researchers and reported in 1988 (Miller and Shao
1990
).
More recently, there have been some attempts to estimate interregional trade
flows using Commodity Flow Survey (CFS) data (Liu and Vilain
2004
; USDOT,
FHWA
2002
; Jackson et al.
2006
; Park et al.
2009
). The U.S. Commodity Trans-
portation Survey Data on inter-regional trade flows have been available since 1977
1
This paper focuses only on the US economy. However, interregional I-O models have been
developed in many parts of the world. Most of them have been built up from Isard's (and
Leontief's) ideas. None of them have the degree of spatial and sectoral disaggregation found in
NIEMO, the model discussed in this paper. Samples of the research are listed here: Akita and
Kateoka (
2002
), Bonfiglio (
2005
), Hulu and Hewings (
1993
), Ichimura and Wong (
2003
),
IDE-JETRO (
2000
,
2005
), Kratena et al. (
2013
), Okamoto et al. (
2005
), Perez et al. (
2008
),
Sargento (
2009
), Thijs (
1983
), Trinh et al. (
2013
), Turner et al. (
2011
), Zhang and Shi (
2009
).
Most of these have been written in the last decade. The examples are from Asia and Europe: Japan,
China, Korea, Vietnam, Indonesia, the European Union, Netherlands, the United Kingdom, Spain,
Portugal and Romania. A large majority of the studies are empirically based and we were unable to
discover a theoretical innovation that needed to be discussed in the main text of this paper.
