The motivation for my conceptual articles is to work out the logic for addressing new, or broader, empirical questions (see empirical articles). Some of them deal with ideas but most take the next step by developing new mathematical models and illustrating their attributes using illustrative numerical examples. The exception is the first article, which presents the World Trade Model (WTM). Having carried out several empirical studies about future paths for the global economy using the pioneering World Model developed by W. Leontief, A. P. Carter, and P. Petri, I rendered it far more succinct and more transparent by developing a fully generalized theory of comparative advantage (rather than exogenous trade parameters) to make trade flows endogenous. The standard treatment of comparative advantage assumes two countries that produce two goods using two factors of production (and typically assumes the same technologies in both regions). The World Trade Model generalizes the theory to any number of regions, goods, and factors and allows for different technologies. The economic efficiency associated with comparative advantage serves as the default assumption that can be over-ridden (for example, by government policies). This is achieved by a model of constrained optimization, where the use of resources is limited to their endowments.
Subsequent model extensions include the rectangular choice-of-technology (RCOT) model, which uses a comparable logic to allow producing sectors in a single region to choose one or more from among alternative input structures. It is named “rectangular” to emphasize that relaxing the constraint that a general input-output database of intermediate requirements is by definition square allows for a broader logic that takes more kinds of relationships into account than can the inversion of a square matrix. Still, the resulting model is straightforward to interpret and to apply.
See Publications page for a complete list of publications.
A World Trade Model based on Comparative Advantage with m Regions, n Goods, and k Factors
Introduction of the World Trade Model.
A World Trade Model with Bilateral Trade Based on Comparative Advantage
This model extends the World Trade Model by introducing a matrix of the distance between each pair of potential trade partners and specifying production sectors providing international transport of traded products. The resulting WTMBT makes it possible to endogenously determine bilateral trade flows.
Sustainable Consumption of Food
This paper considers prospects for systematic changes in human diets, their implications for agriculture, and impacts for human health and the environment. The concepts discussed have subsequently been put to use in several empirical studies about changes in agricultural technologies, regarding especially use of land and water.
Physical and Monetary Input-Output Analysis: What Makes the Difference?
The paper addresses the move from economic databases expressed in money values only to the use of mixed units in input-output databases. With the significant collaborations between input-output economists and industrial ecologists in recent years, the use of physical units has become more common.
Rents in the Era of Resource Scarcity: Global Payment Flows under Alternative Scenarios
Even the most basic input-output model has a primal dealing with quantities and a dual in terms of unit prices. However, most empirical studies still today deal with the primal only and in addition quantify all its components in money values. The World Trade Model associates rents with scarce resources, that is, with factors of production that are fully utilized. The paper illustrates how the price dual of the WTM makes it possible to track associated rent payments to labor, capital, and owners of natural resources.
Duchin, F. and S. Levine, 2015. Journal of Economic Structures, 4(1).
Sectors May Use Multiple Technologies Simultaneously: The Rectangular Choice-of-Technology Model with Binding Factor Constraints
This paper presents the Rectangular Choice-of-Technology (RCOT) model, so-called because it replaces the square matrices that are (mistakenly) taken to be a defining feature of input-output economics with rectangular matrices, where each sector is still represented by a single row but by as many columns as it has technological alternatives.
Duchin, F. and S. H. Levine, 2011. Economic Systems Research, 23(3): 281-302.
The Rectangular Sector-by-Technology Model: Not Every Economy Produces Every Product and Some Products May Rely on Several Technologies Simultaneously
In this paper the Rectangular Choice-of-Technology (RCOT) model is incorporated within the World Trade Model. Now the logic of comparative advantage allocates production not only among potential trade partners but also among each one’s technological options.
Duchin, F. and S. Levine, 2012. Journal of Economic Structures, 1(1): 11 pp.
The Transformative Potential of Input–Output Economics for Addressing Critical Resource Challenges of the Twenty-First Century
The paper offers a brief history of input-output economics and identifies its features that can be most revealing for evaluating options for dealing with 21st century challenges. I focus in particular on the theoretical assumptions underlying input-output models that distinguish them from mainstream economic thinking.
Duchin, F., 2015, Chapter 8 in M. Baranzini, C. Rotondi, and R. Scazzieri, Editors, Scale Constraints, Resource Rents, and Structural Dynamics, Cambridge University Press. Download
Combining Multiregional Input-Output Analysis with a World Trade Model for Evaluating Scenarios for Sustainable Use of Global Resources
In recent years a number of multiregional input-output (MRIO) databases have become available along with an MRIO model that relies on the inversion of a (large) square matrix. This paper discusses the potential advantages of broadening the MRIO model to incorporate additional features. This paper is accompanied by a second article that provides an illustrative application
Duchin, F. and S.H. Levine, 2016, Journal of Industrial Ecology, 20(4): 775-782.
Bottom-Up and Top-Down: A Global Case-Study Framework Applied to Water Supply and Sanitation
Duchin, F. 2016, Journal of Industrial Ecology, 20(3): 387-395.
The Recovery of Products and Materials for Reuse: The Global Context of Resource Management
This Special Issue was organized to focus on Waste Input-Output analysis pioneered by S. Nakamura and Y. Kondo. Our paper situates waste recovery versus reliance on virgin materials as a choice among alternative technologies using the RCOT framework. The model is then used for an illustrative global analysis that shows the differential impacts of deep global resource recovery on regions that depend on income from resource exports versus ones that are resource-poor but can recover abundant quantities of materials from obsolescent built capital.
Duchin, F. and SH Levine, 2019. Resources, Conservation & Recycling, 145: 422-447 (Special Issue on Economy-wide Prospects for Material Recovery and Waste Recycling: Advances in Integrating Input-Output Economics and Industrial Ecology).