Disaggregating input-output tables in time: the temporal input-output framework

The input-output framework has evolved dramatically since its initial formulation. New analytical techniques and extensions have allowed a more comprehensive assessment of the economy and expanded its applicability. Nonetheless, the core of the framework has remained unchanged: an annually compiled input-output table, which conveys monetary flows between sectors in a region in a particular year. Hence, the technical coefficients derived from it are 'average' input compositions, neglecting fluctuations in production capacity, seasonality and temporal shocks within that period. This paper develops a consistent methodology to disaggregate the annual input-output table in its time dimension in order to estimate intra-year input-output matrices with distinct technical structures for a particular year. The main advantages in relation to the annual model are to allow seasonal effects to be studied within the input-output framework, to better understand the process of coefficient change and to offer a more comprehensive dynamic view of production.