INPUT-OUTPUT FORECASTING OF REGIONAL AGRICULTURAL POLICY IMPACTS

Input-output coefficients and multipliers based upon them are increasi ngly being used to evaluate the impact of changes in agricultural poli cies, yet there are a number of specific difficulties with regard to t heir use in this context. This paper articulates various criticisms wh ich can be made, and tests their validity by comparing multiplier fore casts with out-turns from a series of eight input-output tables descri bing the Welsh agricultural sector. The predictive performance deterio rates rapidly as the time between base matrix and forecast year increa ses; more attention needs to be paid to the forecasting of final deman d, spill-over effects into other sectors, and the functional relations hip between labour input and gross output.