Measuring structural change in the I-O production function by biproportional methods: A theorem of price invariance

This research note demonstrates the advantage of biproportional projection over the ordinary (proportional) method of technical coefficients in input-output analysis: the former is insensitive to price changes, the latter is not so. Consequently, structural change can generally be measured using the biproportional filter on tables in current prices instead of inflation-adjusted matrices, without changing anything in the result. This may be useful when price information and inflation-adjusted matrices are unavailable. The result can be applied to matrix updating. Copyright (c) 2006 the author(s). Journal compilation (c) 2006 RSAI.