Production Networks and Economic Policy
41 Pages Posted: 31 Jul 2019
Date Written: July 28, 2019
In this paper, we show how to combine data on input-output tables and recent insights from the theory of production networks in order to inform policy. We first describe the information contained in input-output tables compiled by statistical agencies, and show how to derive relevant statistics of production networks. We then discuss the implications of production networks for policy intervention in a series of domains, such as fiscal policy, industrial policy, or, finance. Finally, we present a quantitative exercise applied to French data in order to illustrate that production networks shape the overall impact of competition policy on the economy.
Keywords: Production Network, Input-Output, Inefficiencies, Policy, Fiscal Policy, Industrial Policy, Finance, Industrial Organisation
JEL Classification: L13, L14, E23
Suggested Citation: Suggested Citation