The impact of transportation on the Croatian economy: The input-output approach

The aim of this paper was to determine the economic impact of the transportation sector on the Croatian economy by using input-output analysis. According to the input-output tables for the Croatian economy for 2004, 2010, 2013, and 2015, output and gross value-added multipliers were calculated. The results of the conducted analysis indicated that the multiplicative effects of the transportation sector in Croatia were significant in the observed period, especially for the air transport sector. Furthermore, comparative multiplier analysis with selected European Union countries was performed to assess the Croatian transportation industry position from an international perspective. Lower output and gross value-added multipliers for the Croatian transportation sector imply that old European Union member states capitalized the transportation sector more for growth and development. The Croatian transportation sector recorded lower imported intermediate inputs, average domestic inputs, and higher value-added multipliers similar to new European Union members. Simulations based on multiplicative effects show that restrictions on movements and human contacts, imposed due to the COVID-19 pandemic, could induce a strong reduction in the economic activity of transport and other sectors that are included in the value-added chain of the transport industry.