2.1.2. Supply and Use Tables
(SUT)
The SNA93 recommended that national accounts estimates should
be compiled in a supply and use framework. Such framework enables estimates of
supply to be confronted with the estimates of use. The SUT serves for
statistical and analytical purposes .They provide a framework for checking the
consistency of statistics on flows of goods and services obtained from quite
different kinds of statistical sources, industrial survey, household
expenditure inquiries, investment surveys, foreign trade statistics and other
statistics compiled in so called Input-Output Table(KAREN Wilson 2004, 2).
2.1.3. SUT concept, linear model, and GDP derivation
The SUT proper, include two matrices, that are, an Output
matrix and an Intermediate consumption or Input matrix (O-I) (Hand book of NA
2002; 65).These two matrix derived directly from differences in detail and
structure of ISIC and CPC and also from the definition of establishment unit
used in classifying industries, as defined in SNA may be linearly modelled for
being merely used in different flied (mathematics, economics, statistics etc)
SUPPLY=USE
P+M+CM+TM+TP-SP = IC + FC + FCFG + ?inv + EX
Because trade and transport margins may be used to estimate
value of output of the trade industry, the identity becomes;
P+M+TP-SP = IC+FC+FCFG+?inv + EX
CM and TM disappear because P now represents the value of the
production of all branches included trade and transport.
Because, a part of resources was absorbed as intermediate
consumption, and for the efficacy of this identity we have to subtract IC from
each part.
P-IC+M+TP-SP = IC- IC + FC + FCFG + ?inv + EX
And is known that;
P-IC = Value Added (VA), therefore;
VA+M+TP-SP =FC+FCFG+?inv + EX
The VA is measured on basic price because it is for P .The
summation of VA with TP nets of SP implies that VA at acquisition price equal
to Gross Domestic Product (GDP).
GDP+M = FC + FCFG + ?inv + EX
For the international trade indicator purposes analysis the
identity becomes;
GDP = FC +FCFG + ?inv + EX-M
This final identity is very synthetic identity which describes
operations of goods and services of an economy.
GDP is an important indicator for economic development ,first
is used in (GDP per capital ,Gross National Income (GNI), Gross National
Disposable Income (GNDI) , GDP Deflator (an index for average price level of an
economy's production related to a base year , etc...).Second ,is very used in
combination with other socio-economic indicators to identify economic
development and economic development projection (Human Development Index ,
Headcount Index , Human Poverty Index , Poverty Weighted Index , etc...).
2.1.4. The role of SUT in decision making, projection and
planning
In order to make SUT information useful, it is better to learn
how to present the right information in the right way at the right time. SUT is
expected to have this quality. Therefore the objectivity of decision making
depends on how in selecting at least one of the alternative actions the degree
of uncertainty surrounding this decision is reduced, and the outcome of this
decision is improved.
While the tradition application of SUT was to provide
historical growth or decries of GDP of an economy, today the trends have been
moving toward emphasizing the economic decision making function because of the
utilization of SUT data for planning and projecting future economic activities
(Brody A. & Carter A.P., 1971, pp 44-60).
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