Better policy analysis with better data. Constructing a Social Accounting Matrix from the European System of National Accounts.



As Pyatt (1991) concluded: "... a SAM is a framework both for models of how the economy works
as well as for data which monitor its workings. Recognition of this duality is of basic importance
for quantitative analysis. It implies,
inter alia, that the accounting identities which are captured by a
SAM are not to be regarded simply as consistency requirements which must be imposed on a
model, but rather they should be seen as a logical consequence of the paradigms which economists
have adopted for analyzing society".

On the other hand, the flexibility of the SAM makes it possible, by either top-down or bottom-up
methods, to break down or aggregate each account into categories without losing the consistency of the
whole system
, which can be a crucial feature for economic modelling.

Especially at the macro and the meso level, economic models should have accounting frameworks
which, with their inherent consistency and Computable General Equilibrium (CGE) models, in
particular, "describe the whole circular flow of a market economy, while maintaining accounting
consistency" and are therefore "appropriate for operating within a SAM framework" (Abbink et al.,
1995).

The implementation of inappropriate policies may result, at least in part, from a deficient
knowledge of their (direct and indirect) effects, which may in turn result from inappropriate
economic modelling or the inadequacy of the databases that support this, so that the SAM as
proposed here, and its modelling, may be a step forward.

4. Concluding Remarks

The flexibility and consistency inherent in the SAM and the possibility of its construction from the
national accounts systems that adopt the SNA 93, notably the ESA 95, may be considered important
contributions towards better policy analysis from better data.

The European Union, for instance, could use regional SAMs to construct a European SAM, it being
possible to identify and work, in a more or less detailed way7, with all the transactions within and
between EU member states in a flexible and consistent framework.

Since SAMs can be constructed from the national accounts, time series of national accounting
transactions could be compiled and, using the available computing technology, these could then be
exposed to the wide range of possibilities of econometric modelling, for the definition of the SAM
cell contents. Most importantly, it is even possible to consider qualitative variables, to separate
quantities and prices (using current and constant price series or series from the previous year) or to
calculate elasticities. It would then be possible to speak, for instance, of dynamic econometric

7 For the highlighting of the development and forecasting of the System of Economic and Social Accounting Matrices
and Extensions (SESAME), in which the basic principles of national accounts are extended to include a wider range of
statistics, notably social and environmental ones, see, for instance, Keuning (1996).

- 11 -



More intriguing information

1. The name is absent
2. Markets for Influence
3. The name is absent
4. Three Policies to Improve Productivity Growth in Canada
5. Emissions Trading, Electricity Industry Restructuring and Investment in Pollution Abatement
6. Quelles politiques de développement durable au Mali et à Madagascar ?
7. Discourse Patterns in First Language Use at Hcme and Second Language Learning at School: an Ethnographic Approach
8. SLA RESEARCH ON SELF-DIRECTION: THEORETICAL AND PRACTICAL ISSUES
9. How to do things without words: Infants, utterance-activity and distributed cognition.
10. Standards behaviours face to innovation of the entrepreneurships of Beira Interior
11. Investment in Next Generation Networks and the Role of Regulation: A Real Option Approach
12. References
13. On the Integration of Digital Technologies into Mathematics Classrooms
14. The voluntary welfare associations in Germany: An overview
15. Do the Largest Firms Grow the Fastest? The Case of U.S. Dairies
16. Monetary Policy News and Exchange Rate Responses: Do Only Surprises Matter?
17. L'organisation en réseau comme forme « indéterminée »
18. Does Presenting Patients’ BMI Increase Documentation of Obesity?
19. EU Preferential Partners in Search of New Policy Strategies for Agriculture: The Case of Citrus Sector in Trinidad and Tobago
20. Types of Cost in Inductive Concept Learning