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Yadulla Hasanli, Gunay Rahimli: Assessment of The Multiplicative Effects of The Mining and
                                                                                Manufacturing Sectors nn Azerbaijan

                    SAMs are compiled for two reasons: first, they present an all-inclusive and easily
                    comprehensible picture of the current state of the economy; second, they serve as the
                    industry  standard  database  for  economy  modellers,  providing  information  for
                    economic  models  (such  as  the  more  detailed  Computable  General  Equilibrium  or
                    multi-sectorial linear models).

                    Table 2: Social Accounting Matrix

























                                        Source: (Antonopoulos R., Kim K., 2008)

                    Multiplier models based on SAM can be formulated as follows: column coefficients
                    are calculated as in input-output tables. The matrix A is then obtained by dividing
                    each column element of this matrix by the column sum (Y) from the T SAM matrix.
                    It is evident that this will satisfy the following equality:

                                                       T=AY                                                              (4)

                    We can construct the following equation for each line:

                                                    Y=AY+X                                         (5)
                    From here we can get:

                                                 Y = ( İ −  A) −1 X =  M a X                           (6)


                    Here,  M  is the multiplier matrix. When the matrix A is fixed, M  will also be fixed,
                                                                                   a
                            a
                    and then equation (6) determines the equilibrium value of y corresponding to any
                    change in X (Defourny and Thorbecke, 1984). This formula can be used to calculate
                    the amount that changes in any one of the exogenous accounts that affect Y.




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