A Study on the Requirements Matrix through the Concept of “Correct Consecutive Connections”: Based on the Three Different Models of IO, OO, and FF

Sancho (2012) showed that the first general relation between two different notions of direct and indirect input requirements ( and ), proposed by Gim and Kim (1998), is actually faulty. However, Gim and Kim (2005, 2008a, 2008b, 2009), prior to Sancho’s comment, verified continuously the requirements matrices can be decomposed by factors and also proposed the complemented general relation on the basis of the correct consecutive connection. Through the complemented general relation, we definitely point out that there is a “consecutive connection” between and and moreover the product makes sense economically, where is the diagonal element of the Leontief inverse. By using a complete framework of the requirements matrices, we can finally derive a new output-output (OO) and final demand-final output (FF) models, which are of great use in calculating the various impacts among the assorted cause and effect variables.