NEOCLASSICAL INPUT-OUTPUT-ANALYSIS

The Canadian comparative advantage is determined by maximization of fo reign earnings subject to input-output relations between 29 industries and 92 commodities. Free trade would boost the mining, quarrying & oi l wells. tobacco, and machinery sectors. The structure of the economy is not self-sufficient. as a necessary and sufficient price condition shows. When commodities are aggregated to the 29 sectors, the shadow p rices to the programs fulfill the value equations of input-output anal ysis and admit a decomposition of Canadian inefficiency in 5% X-ineffi ciency, 15% allocative inefficiency, and 80% international specializat ion mismatch.