IO EconOMICS

SOcial accounting matrix (SAM) and cge dataBASE

 

Social Accounting Matrix (SAM) is an extension of Leontief's input-output framework with inclusion of the roles of labour, households and the social institutions of the economy. It is tabulated in the form of a balanced square matrix that each cell represents a transaction between two economic agents.

The genesis of SAMs goes back to Sir Richard Stone's work on the System of National Accounts (SNA) in 1960s. He was awarded a Nobel Prize in 1984.

Computable general equilibrium (CGE) models are a class of economic models built on Keynesian theories that expenditure and income are equal at the state of equilibrium.

Each CGE model consists of (1) equations describing the economic variables; (2) a SAM displaying the initial equilibrium; and (3) parameters capturing the behavioural responses of economic agents when the initial equilibrium was shocked. 

CGE models are commonly applied to economic and social policy analysis, but also increasingly to energy, sustainable development and environmental policy modelling.