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The role of supply and use/input output tables in the perspective analysis of economic development of Rwanda

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par Jean Baptiste HABYARIMANA
National University of Rwanda - Bachelor's degree 2010
  

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2.3. From SUT to economic development

Economic activities have strong impact on the environment, and vice-versa. However until recently, environmentally related data have been given little attention in National accounting system .As Bartelmus at al. (1993) pointed out, the SNA fails; consider (a) new scarcities of natural resources that could threaten the sustained production of the economy and (b) the degradation of environmental quality caused mainly by pollution and its effects on human health and welfare.

To overcome these short coming ,the United Nations begin to revise the SNA in 1993.The revised version contains special satellite accounts for the environment as supplement to the central system (United Nations 1993 a.b).In addition to the UN's effort in revising the SNA , a few other studies on integrating environmental accounts with economic accounts have been seen in the literature .For the SAM in particular, studies on incorporating pollution emission and environmental impacts in a SAM framework emerged recently.

Keuning (1993) proposed a extended SAM called the National Accounting Matrix including Environment Accounts (NAMEA) .The NAMEA integrates economic accounts with accounts for pollutants and environmental impacts. In the NAMEA economic flows in monetary terms and pollution effects in physical terms are combined into a single information framework .Pollution emissions from production, consumption, storage, imports and exports (SUT's variables) are presented in emission account and further allocated into a set of environmental themes.

2.3.1. System of Economic and Social Accounting Matrix and Extension (SESAME)

SESAME is statistical information in matrix format from which a set of core economic, environmental and social macro-indicators is derived (Steven 1996; 2) .SESAMEs macro-indicators can be seen as tips of a big iceberg. The general public, the media and busy policy makers are and will be satisfied with a picture in which only these tips emerge.

In this, SESAME serves as a useful extension of present day national accounts, in two aspects. First, the SAM «a Social Accounting Matrix (SAM) is a matrix presentation of a sequence of monetary accounts that each shows a certain economic process and its relation to other economic process (Steven 1996; 9)»- part of a SESAME improves the compilation of national accounts because it integrates more basic sources at meso-level. Secondly SESAME is apt to integrate all kinds of social and environmental statistics (Steven 1996; 145).

2.3.2. Supply and Use table as a SAM building-block

In analogy with the inverse of Input-Output Table or Supply and Use Table, the inverse of endogenous part of a SAM provides a framework for a single, linear model .However a SAM-based inverse enables a more complete analysis of employment multipliers, of exogenous changes in government expenditure and foreign trade (Steven 1996; 151).

Therefore from, a simple, linear model SAM is embedded into a so-called Applied General Equilibrium (AGE) model. These economic-wide models take account of price-quantity interrelation. They apply micro-economic insight and income distribution of a range of policies, from trade liberalization measures to tax rate changes and structural adjustment packages.

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