The usefulness of extended input–output tables incorporating firm heterogeneity

Abstract This study examines the usefulness of an extended input–output table (EIOT) incorporating the heterogeneity of Japanese firms based on differences in ratios of imported intermediate goods to total output. Using an EIOT, the vertical specialization indicator of Japan was calculated, which co...

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Autores principales:	Satoru Hagino, Jiyoung Kim
Formato:	article
Lenguaje:	EN
Publicado:	SpringerOpen 2021
Materias:	Extended input–output table Trade in value added Incorporating firm heterogeneity Vertical specialization Economic growth, development, planning HD72-88 Economics as a science HB71-74
Acceso en línea:	https://doaj.org/article/7066f59ecb094bfc99bf5ca329d1f2f9
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spelling	oai:doaj.org-article:7066f59ecb094bfc99bf5ca329d1f2f92021-12-05T12:10:56ZThe usefulness of extended input–output tables incorporating firm heterogeneity10.1186/s40008-021-00255-32193-2409https://doaj.org/article/7066f59ecb094bfc99bf5ca329d1f2f92021-12-01T00:00:00Zhttps://doi.org/10.1186/s40008-021-00255-3https://doaj.org/toc/2193-2409Abstract This study examines the usefulness of an extended input–output table (EIOT) incorporating the heterogeneity of Japanese firms based on differences in ratios of imported intermediate goods to total output. Using an EIOT, the vertical specialization indicator of Japan was calculated, which corresponds to the foreign value added included in exports. In this process, differences in intermediate input ratios were measured examining different types of firms using firm-level microdata from the Basic Survey of Japanese Business Structure and Activities. The results indicate that distinguishing between exporting and non-exporting firms is relevant for assembly industries such as electronics and automobiles, as widely discussed in the literature. In contrast, for primary materials industries, such as paper, chemical, and metal industries, other distinctions appear to be more relevant. For example, for the chemical industry, wherein firms tend to have large, integrated manufacturing plants, the differences in intermediate import ratios are largest when distinguishing large firms from small and medium firms. For paper and metal industries, which rely on foreign raw materials, the difference is largest when distinguishing between firms with and without foreign affiliates. By incorporating such heterogeneity, the vertical specification indicator increases by 70%; thus, the EIOT captures the foreign value added more comprehensively.Satoru HaginoJiyoung KimSpringerOpenarticleExtended input–output tableTrade in value addedIncorporating firm heterogeneityVertical specializationEconomic growth, development, planningHD72-88Economics as a scienceHB71-74ENJournal of Economic Structures, Vol 10, Iss 1, Pp 1-28 (2021)
institution	DOAJ
collection	DOAJ
language	EN
topic	Extended input–output table Trade in value added Incorporating firm heterogeneity Vertical specialization Economic growth, development, planning HD72-88 Economics as a science HB71-74
spellingShingle	Extended input–output table Trade in value added Incorporating firm heterogeneity Vertical specialization Economic growth, development, planning HD72-88 Economics as a science HB71-74 Satoru Hagino Jiyoung Kim The usefulness of extended input–output tables incorporating firm heterogeneity
description	Abstract This study examines the usefulness of an extended input–output table (EIOT) incorporating the heterogeneity of Japanese firms based on differences in ratios of imported intermediate goods to total output. Using an EIOT, the vertical specialization indicator of Japan was calculated, which corresponds to the foreign value added included in exports. In this process, differences in intermediate input ratios were measured examining different types of firms using firm-level microdata from the Basic Survey of Japanese Business Structure and Activities. The results indicate that distinguishing between exporting and non-exporting firms is relevant for assembly industries such as electronics and automobiles, as widely discussed in the literature. In contrast, for primary materials industries, such as paper, chemical, and metal industries, other distinctions appear to be more relevant. For example, for the chemical industry, wherein firms tend to have large, integrated manufacturing plants, the differences in intermediate import ratios are largest when distinguishing large firms from small and medium firms. For paper and metal industries, which rely on foreign raw materials, the difference is largest when distinguishing between firms with and without foreign affiliates. By incorporating such heterogeneity, the vertical specification indicator increases by 70%; thus, the EIOT captures the foreign value added more comprehensively.
format	article
author	Satoru Hagino Jiyoung Kim
author_facet	Satoru Hagino Jiyoung Kim
author_sort	Satoru Hagino
title	The usefulness of extended input–output tables incorporating firm heterogeneity
title_short	The usefulness of extended input–output tables incorporating firm heterogeneity
title_full	The usefulness of extended input–output tables incorporating firm heterogeneity
title_fullStr	The usefulness of extended input–output tables incorporating firm heterogeneity
title_full_unstemmed	The usefulness of extended input–output tables incorporating firm heterogeneity
title_sort	usefulness of extended input–output tables incorporating firm heterogeneity
publisher	SpringerOpen
publishDate	2021
url	https://doaj.org/article/7066f59ecb094bfc99bf5ca329d1f2f9
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The usefulness of extended input–output tables incorporating firm heterogeneity

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