Academic journal article Canadian Journal of Regional Science

A Bi-Regional Economic Impact Model for the Province of British Columbia: A Social Accounting Matrix Approach */Un Modele D'impact Economique Bi-Regionale Pour la Province De la Colombie-Britannique : Une Approche Des Matrices De Comptabilite Sociale *

Academic journal article Canadian Journal of Regional Science

A Bi-Regional Economic Impact Model for the Province of British Columbia: A Social Accounting Matrix Approach */Un Modele D'impact Economique Bi-Regionale Pour la Province De la Colombie-Britannique : Une Approche Des Matrices De Comptabilite Sociale *

Article excerpt

Sophisticated regional economic modeling in Canada has to date been confined to (i) provincial/territorial-level models and (ii) only single-region models at the sub-provincial or territorial level. The prototype model developed here is constructed for two regions of the province of BC as well as the province as a whole, an advance on single-region models that cannot allow for inter-regional feedback effects in the spending stream and do hot permit simulations of simultaneous impact in different regions and the province overall.

Also, the paper shows the feasibility of using locally specific survey and secondary transactions data in combination with provincial and national data (the so-called 'hybrid' approach to model building) as an advance on the exclusive use at the regional level of transactions data from other jurisdictions (the 'synthetic' approach). Simulated values are shown for impacts of an exogenous shock on output, GDP, household income and employment at regional and provincial levels, and on federal and provincial tax revenues.

Resumes

Au Canada, la modelisation economique elaboree a ete limitee jusqu'a maintenant (i) aux modeles de niveau provincial/territorial et (ii) au niveau sous-provincial ou territorial, aux modeles d'une seule region. Le modele prototype developpe ci-dessous est construit pour deux regions de la province aussi bien que pour la province entiere, ce qui represente une amelioration sur les modeles d'une region, qui ne peuvent ni tenir compte des effets que les reactions inter-regionales auraient sur le courant de depenses, ni permettre des simulations sur l'impact simultane dans les differentes regions et dans la province. De plus, l'analyse et la discussion demontrent la possibilite d'utiliser les donnees des sondages locaux et des transactions secondaires, avec les donnees provinciales et nationales (la soi-disant approche 'hybride' a la construction des modeles), ce qui represente une amelioration sur l'utilisation exclusive, au niveau regional, des donnees des transactions des autres juridictions (l'approche' synthetique'). Des valeurs simulees sont montrees pour les effets d'un choc exogene sur la production, le produit interieur brut, le revenu des menages et l'emploi, aux niveaux regionaux et provinciaux, et sur les recettes fiscales provinciales et federales.

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Local (sub-state or sub-province) economic impact studies have relied heavily on the simple economic base method because it is less demanding in terms of data requirements than more sophisticated general equilibrium methods, specifically macroeconomic models estimated from time-series data using econometric methods, input-output (IO) models, social accounting matrices (SAMs) and computable general equilibrium (CGE) models.

This paper outlines a prototype SAM model for British Columbia and its uses for regional and provincial economic impact analysis. The SAMs reported in the paper are also the preliminary results in a bi-regional CGE-building project.

The main contributions of the study are as follows. First, it shows the feasibility ofdeveloping a database at the regional level within the province using locally specific survey and secondary transactions data in combination with provincial and national data (the so-called 'hybrid' approach to model building) as an advance on the exclusive use at the regional level of transactions data from other jurisdictions (the 'synthetic' approach). Not excessively demanding in terms of data requirements, the approach could be implemented for regional configurations in BC other than the one adopted in this study, or for regions of other provinces. Second, the model is constructed for two regions of the province as well as the province as a whole, an advance on single-region models that cannot allow for inter-regional feedback effects in the spending stream and do not permit simulations of simultaneous impact in different regions and the province overall. …

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