ANALYSING A BI-REGIONAL EXTENDED INPUT­ OUTPUT MODEL INCORPORATING A LABOUR MARKET ACCOUNT

ANALYSING A BI-REGIONAL EXTENDED INPUT­ OUTPUT MODEL INCORPORATING A LABOUR MARKET ACCOUNT

The last thirty years have seen an increasing development and use of extended input-output models, in which the household sector is disaggregated to differentiate between various type of household. The majority of this work has been developed at a single region level and has recently included the incorporation of labour market accounts to analyse the relationship between labour supply and labour demand. In this paper we extend this type of analysis from a single region model to a bi-regional model. We outline a prototype model and highlight the incorporation of commuting patterns as a relatively new development in this son of model. The solution of the model is derived, in general form, and some observations made about the implications of the solution. We conclude by analysing the characteristics of some of the variables contained within the inverse, and raising some more general questions about possible limitations of the model.