Distribution of aggregate income in Portugal from 1995 to 2000 within a SAM (Social Accounting Matrix) framework. Modeling the household sector

FC = final consumption                      S = aggregate supply

GCF = gross capital formation                TC = total costs

I = aggregate investment / investment funds tm = trade margins

IC = intermediate consumption               TV = transactions value

IM = imports                                     ... → ^rw = ... to the rest of the world

Inc = aggregate income⁵                      . «- ^rw = . from the rest of the world

Because the National Accounts were the information source from which the SAMs were
constructed, almost all their (non-financial⁶) flows are included in them. The European
System of National and Regional Accounts in the European Community of 1995 - ESA 95,
which is based on the 1993 version of the United Nations System of National Accounts - SNA
93, made it possible, in a more direct way than before (SNA 68), to construct aggregated
SAMs that are in perfect harmony with this.

Centring our attention on institutions, it is possible in Figure 1 to see how the incomes
(receipts) and the outlays (expenditures) were distributed among Portuguese institutions
between 1995 and 2000.

From this same figure, it is also clear that the households lead other institutions in terms of
total and current incomes and outlays, although their relative importance in terms of capital
incomes and outlays is much less important, as is also shown by Table 2.

Therefore, aggregate household income was more than half of total aggregate income,
although its relative importance decreased, especially from 1995 to 1999. On the other hand,
aggregate household investment/investment funds was less than a quarter of the total and its
relative importance also decreased, especially from 1995 to 1998. These decreases would only
have been relative if the average growth rates had not been as shown in Table 3.

⁵ In accordance with the SNA’s secondary distribution of income accounts, the redistribution of income in kind
and the use of disposable income accounts, this is equal to gross national income plus current transfers within
national institutions and current transfers from the rest of the world. Or, alternatively, it is equal to gross
disposable income plus current transfers within national institutions and current transfers to the rest of the world
(Santos 2003a, pp. 13-15).

⁶ In a previous work (Santos, 1999), financial flows, reflecting financial activities in capital accounts (King
1981), were also included. When SAMs began to be constructed with data from the European System of
National and Regional Accounts in the European Community of 1995 (ESA 95), this proved to be impossible
due to a lack of available information.

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