Technology of Input–Output Analysis with CES Production: Application for Studying the Kazakhstan Supply Chain during the COVID-19 Pandemic

Askar Boranbayev, Nataliia Obrosova, Alexander Shananin

Research output: Contribution to journalArticlepeer-review

Abstract

Input–output analysis finds widespread application in estimating the shock effects on production networks within both local and global economies. We are developing a new technology for intersectoral analysis that takes into account the substitution of production factors within a complex supply network triggered by external or internal shocks. This technology is based on the explicit solution of a pair of convex programming problems: the resource allocation problem under the assumption of Constant Elasticity of Substitution (CES) technologies and the special dual Young problem. Solving these problems, we can ascertain the equilibrium inputs and price indexes of goods within the production network. In this paper, we apply this technology to analyze the economy of Kazakhstan in the context of the COVID-19 pandemic. Our calculations provide us with the means to discuss the macroeconomic responses of the multi-sectoral production network in Kazakhstan to both external and internal shocks stemming from the pandemic.

Original languageEnglish
Article number14057
JournalSustainability (Switzerland)
Volume15
Issue number19
DOIs
Publication statusPublished - Oct 2023

Keywords

  • CES production function
  • competitive equilibrium
  • economic shocks
  • input–output analysis
  • pandemic
  • resource allocation problem
  • Young transform

ASJC Scopus subject areas

  • Computer Science (miscellaneous)
  • Geography, Planning and Development
  • Renewable Energy, Sustainability and the Environment
  • Environmental Science (miscellaneous)
  • Energy Engineering and Power Technology
  • Hardware and Architecture
  • Computer Networks and Communications
  • Management, Monitoring, Policy and Law

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