Quantifying the Linkages and Leakages of Construction Activities in an Open Economy Using Multiregional Input-Output Analysis

Cathy C.W. Hung, Shu Chien Hsu, Stephen Pratt, Pi-cheng chen, Chia Jung Lee, Albert P.C. Chan

Research output: Contribution to journalArticle

Abstract

This study proposes an analytical framework to evaluate the economic influence and leakage of the construction sector in a small and open economy, using Hong Kong as a case study. Input-output analysis (IOA) is used to capture the domestic intersectoral linkages, and multiregional IOA is used to measure the leakages resulting from international trade. In the absence of Hong Kong official input-output tables (IOTs), five IOTs during 1995-2013 and three multiregional IOTs from 2004, 2007, and 2011 are compiled using the Global Trade Analysis Project (GTAP) database in conjunction with official statistics. Comparisons with other economies are included to disclose the relative economic influences of Hong Kong's construction sector. The results reveal the declining economic importance of Hong Kong's construction sector in stimulating economic growth, along with increased leakage to the manufacturing sectors abroad. The domestic backward linkage dropped from 1.74 in 1995 to 1.55 in 2013 per unit of final demand. In 2011, 40.55% of the economic contribution leaked out through international trade. The outcomes provide a rational basis with which to inform the decision making of the Hong Kong government in infrastructure planning, resource utilization, and benefit optimization. An import substitution policy is recommended to ease foreign dependence through local production of construction products.

LanguageEnglish
Article number04018054
JournalJournal of Management in Engineering
Volume35
Issue number1
DOIs
Publication statusPublished - 2019 Jan 1

Fingerprint

Economics
International trade
Substitution reactions
Decision making
Linkage
Leakage
Open economy
Hong Kong
Input-output analysis
Statistics
Planning
Construction sector
Input-output table

All Science Journal Classification (ASJC) codes

  • Industrial relations
  • Engineering(all)
  • Strategy and Management
  • Management Science and Operations Research

Cite this

Hung, Cathy C.W. ; Hsu, Shu Chien ; Pratt, Stephen ; chen, Pi-cheng ; Lee, Chia Jung ; Chan, Albert P.C. / Quantifying the Linkages and Leakages of Construction Activities in an Open Economy Using Multiregional Input-Output Analysis. In: Journal of Management in Engineering. 2019 ; Vol. 35, No. 1.
@article{57d5da4fb6ce4aab883ac299dab60062,
title = "Quantifying the Linkages and Leakages of Construction Activities in an Open Economy Using Multiregional Input-Output Analysis",
abstract = "This study proposes an analytical framework to evaluate the economic influence and leakage of the construction sector in a small and open economy, using Hong Kong as a case study. Input-output analysis (IOA) is used to capture the domestic intersectoral linkages, and multiregional IOA is used to measure the leakages resulting from international trade. In the absence of Hong Kong official input-output tables (IOTs), five IOTs during 1995-2013 and three multiregional IOTs from 2004, 2007, and 2011 are compiled using the Global Trade Analysis Project (GTAP) database in conjunction with official statistics. Comparisons with other economies are included to disclose the relative economic influences of Hong Kong's construction sector. The results reveal the declining economic importance of Hong Kong's construction sector in stimulating economic growth, along with increased leakage to the manufacturing sectors abroad. The domestic backward linkage dropped from 1.74 in 1995 to 1.55 in 2013 per unit of final demand. In 2011, 40.55{\%} of the economic contribution leaked out through international trade. The outcomes provide a rational basis with which to inform the decision making of the Hong Kong government in infrastructure planning, resource utilization, and benefit optimization. An import substitution policy is recommended to ease foreign dependence through local production of construction products.",
author = "Hung, {Cathy C.W.} and Hsu, {Shu Chien} and Stephen Pratt and Pi-cheng chen and Lee, {Chia Jung} and Chan, {Albert P.C.}",
year = "2019",
month = "1",
day = "1",
doi = "10.1061/(ASCE)ME.1943-5479.0000653",
language = "English",
volume = "35",
journal = "Journal of Management in Engineering - ASCE",
issn = "0742-597X",
publisher = "American Society of Civil Engineers (ASCE)",
number = "1",

}

Quantifying the Linkages and Leakages of Construction Activities in an Open Economy Using Multiregional Input-Output Analysis. / Hung, Cathy C.W.; Hsu, Shu Chien; Pratt, Stephen; chen, Pi-cheng; Lee, Chia Jung; Chan, Albert P.C.

In: Journal of Management in Engineering, Vol. 35, No. 1, 04018054, 01.01.2019.

Research output: Contribution to journalArticle

TY - JOUR

T1 - Quantifying the Linkages and Leakages of Construction Activities in an Open Economy Using Multiregional Input-Output Analysis

AU - Hung, Cathy C.W.

AU - Hsu, Shu Chien

AU - Pratt, Stephen

AU - chen, Pi-cheng

AU - Lee, Chia Jung

AU - Chan, Albert P.C.

PY - 2019/1/1

Y1 - 2019/1/1

N2 - This study proposes an analytical framework to evaluate the economic influence and leakage of the construction sector in a small and open economy, using Hong Kong as a case study. Input-output analysis (IOA) is used to capture the domestic intersectoral linkages, and multiregional IOA is used to measure the leakages resulting from international trade. In the absence of Hong Kong official input-output tables (IOTs), five IOTs during 1995-2013 and three multiregional IOTs from 2004, 2007, and 2011 are compiled using the Global Trade Analysis Project (GTAP) database in conjunction with official statistics. Comparisons with other economies are included to disclose the relative economic influences of Hong Kong's construction sector. The results reveal the declining economic importance of Hong Kong's construction sector in stimulating economic growth, along with increased leakage to the manufacturing sectors abroad. The domestic backward linkage dropped from 1.74 in 1995 to 1.55 in 2013 per unit of final demand. In 2011, 40.55% of the economic contribution leaked out through international trade. The outcomes provide a rational basis with which to inform the decision making of the Hong Kong government in infrastructure planning, resource utilization, and benefit optimization. An import substitution policy is recommended to ease foreign dependence through local production of construction products.

AB - This study proposes an analytical framework to evaluate the economic influence and leakage of the construction sector in a small and open economy, using Hong Kong as a case study. Input-output analysis (IOA) is used to capture the domestic intersectoral linkages, and multiregional IOA is used to measure the leakages resulting from international trade. In the absence of Hong Kong official input-output tables (IOTs), five IOTs during 1995-2013 and three multiregional IOTs from 2004, 2007, and 2011 are compiled using the Global Trade Analysis Project (GTAP) database in conjunction with official statistics. Comparisons with other economies are included to disclose the relative economic influences of Hong Kong's construction sector. The results reveal the declining economic importance of Hong Kong's construction sector in stimulating economic growth, along with increased leakage to the manufacturing sectors abroad. The domestic backward linkage dropped from 1.74 in 1995 to 1.55 in 2013 per unit of final demand. In 2011, 40.55% of the economic contribution leaked out through international trade. The outcomes provide a rational basis with which to inform the decision making of the Hong Kong government in infrastructure planning, resource utilization, and benefit optimization. An import substitution policy is recommended to ease foreign dependence through local production of construction products.

UR - http://www.scopus.com/inward/record.url?scp=85056629115&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=85056629115&partnerID=8YFLogxK

U2 - 10.1061/(ASCE)ME.1943-5479.0000653

DO - 10.1061/(ASCE)ME.1943-5479.0000653

M3 - Article

VL - 35

JO - Journal of Management in Engineering - ASCE

T2 - Journal of Management in Engineering - ASCE

JF - Journal of Management in Engineering - ASCE

SN - 0742-597X

IS - 1

M1 - 04018054

ER -