Input-Output Analysis

Input-output analysis is an economic model that represents how different branches of a national economy or different regional economies are interconnected. It was developed by Russian-American economist Wassily Leontief and the development of the input-output model won him a Nobel Prize in Economics. The model is useful for illustrating relationships between industries within an economy and depicting how output from one industrial sector can be transferred to input in another. It has been incorporated into the accounting system of many developed nations and is used to calculate important measures such as the GDP.