Es#ma#ng the Impact of the Irish Marine Sector: A Macroeconomic Input-­‐Output Analysis Eoin Grealis1, Amaya Vega1, Cathal O’Donoghue2 1Socio-­‐Economic Marine Research Unit 2Rural Economy Development Programme, Teagasc Overview
q Summary of the Marine Sector
q I-O Modelling for Macroeconomic Policy
Analysis
q Leontief Inverse Matrix
q Disaggregation of the Marine Sector
q Future Work
The Marine Sector
q  Ireland’s Marine Sector (2010)
q  Turnover of €3.5bn
q  Gross Value Added €1.2bn (0.8% GDP)
q  16,000+ Employed (FTE)
q  Ocean Wealth Targets – IMP for Ireland 2012
q  Turnover to Exceed €6.4bn in 2020
q  Seafood (€1bn), Commerce and Ship leasing (€2.6bn)
Tourism and Leisure (€1.5bn)
q  Increase Marine sectors GDP contribution to 2.4% by 2030
Source: Ocean Economy Report, SEMRU, 2013
The Marine Sector
Turnover 2010 7% 5% 1% Shipping and Mari?me Transport 41% 21% Marine Tourism and Leisure, Cruise Seafood Oil, Gas, Marine Manu, Eng and Cons Emerging Industries 25% Sector Shipping and Mari?me Transport Marine Tourism and Leisure, Cruise Seafood Oil, Gas, Marine Manu, Eng and Cons Emerging Industries Marine Retail Service Total Turnover 1,422,430 858,130 714,280 236,571 163,926 57,688 3,453,025 Source: Ocean Economy Report, SEMRU, 2013
The Marine Sector
Employment 2010 6% 1% 10% 28% Shipping and Mari?me Transport Marine Tourism and Leisure, Cruise Seafood Oil, Gas, Marine Manu, Eng and Cons 33% 22% Sector Shipping and Mari?me Transport Marine Tourism and Leisure, Cruise Seafood Oil, Gas, Marine Manu, Eng and Cons Emerging Industries Marine Retail Service Total Emerging Industries Employment 4,633 3,573 5,329 1,587 989 252 16,363 Source: Ocean Economy Report, SEMRU, 2013
The Marine Sector
GVA/Marine Sector Employee 2010 160.0 140.0 120.0 100.0 80.0 60.0 40.0 20.0 0.0 134.6 91.1 96.3 45.6 66.3 78.0 GVA/Employee Shipping Marine and Tourism Mari?me and Transport Leisure, Cruise Seafood Oil, Gas, Emerging Marine Industries Manu, Eng and Cons Sector Shipping and Mari?me Transport Marine Tourism and Leisure, Cruise Seafood Oil, Gas, Marine Manu, Eng and Cons Emerging Industries Marine Retail Service Total Marine Retail Service GVA(€000s)/FTE 91.1 96.3 45.6 66.3 78.0 134.6 74.9 Source: Ocean Economy Report, SEMRU, 2013
The Marine Sector
q Relative importance from an economic policy perspective
q Shipping and Marine Transport > Largest share of Turnover
q Seafood Sector > Largest Share of Employment
q Marine Retail Sector > Highest GVA return per Employee
q Does not identify sector’s relative importance in the wider
economy.
q Sectors do not operation in isolation but rely on inputs and
demand for outputs from other sectors
q Economy is a nested web of inter-dependent economic activity,
consisting of a diverse series of linkages explaining the inputs,
processes and outputs from one sector to the next
I-O Modelling for Macroeconomic
Policy Analysis
q I-O Analysis can assist policy makers by identify the key
relationships allowing for the targeting of investment/assistance/
R&D funding given limited resources
q Attempts to capture the circular flow of economic activity
q Analysis performed through the use of Input-Output tables
Input-Output Tables
q Summarise the source of inputs and the des?na?on of outputs for all produc?on sectors of the economy q Provides a means of studying: q The intensity and direc?on of rela?onships between produc?on sectors q The rela?ve importance of the different factors of produc?on used by each sector q Trade Balance (Imports and Exports) EC 429 Marine Economics: An Introduc?on to Input-­‐Output Modelling -­‐ Eoin Grealis Total outputs ( = total domes#c supply in Table 1) Input-Output Tables
Products (€m) Agriculture, forestry and fishing Manufacturing Services Total intermediate consump?on Imports and Taxes less subsidies Total consump#on at purchasers' prices Gross Value added Total inputs (=Total domes#c supply row in Table 1) 975 501 638 2,118 2,121 4,240 2,122 6,362 3,173 4,451 8,108 15,733 47,373 63,106 33,634 96,740 172 5,346 62,894 68,412 57,568 125,979 107,310 233,290 4,321 10,298 71,640 86,263 107,062 193,325 143,066 336,391 Final Demand Total inter-­‐industry Services Manufacturing Agriculture, forestry and fishing Total Product Inputs = Total Product Outputs Products (€m) q 2010 Symmetric Input-Output Table CSO (2014)
q Columns represent the source of product inputs
q Rows represent destination of outputs
2,041 86,438 161,650 250,129 36,294 286,423 6,362 96,736 233,290 336,391 143,356 479,747 Leontief Inverse Matrix
Leontief Inverse Matrix
Services Products Agriculture, forestry and fishing Manufacturing Services Total intermediate consump?on Imports and Taxes less subsidies Gross Value added Total Manufacturing Products Agriculture, forestry and fishing q  A matrix expresses the links between the various sectors
of the economy in proportionate terms rather than
absolute (or nominal) terms thus revealing the combined
input requirements to produce one unit of output
0.03 0.05 0.08 0.16 0.49 0.35 1 0.00 0.02 0.27 0.29 0.25 0.46 1 0.15 0.08 0.10 0.33 0.33 0.33 1 2010 “A” Matrix
Source: Supply, Use Input and Output Tables CSO (2014)
Leontief Inverse Matrix
Services Agriculture, forestry and fishing 1.19 0.04 0.00 Manufacturing 0.10 1.05 0.03 Services Output Mul#pliers 0.17 1.46 0.13 1.22 1.37 1.41 Products Agriculture, forestry and fishing Manufacturing q Leontief Inverse Matrix (I-A)-1represents the total direct
and indirect output per unit of exogenous final demand for
each sector
Products 2010 (I-A)-1 Matrix
Source: Supply, Use Input and Output Tables CSO (2014)
Disaggregating the Marine Sector
q Symmetric I-O table for Ireland (2010)
q 58*58 matrix of product inputs and flows
q Product classification aggregated to broad NACE code
categories determined by the CSO
q Water Transport (50) only fully marine sector
q Remainder must be disaggregated from broad NACE code
categories in order to analyse the various marine sectors
relative importance in the wider economy
q Requires detailed information on the sources of inputs and
destination of outputs for various marine sectors collated from a
number of different data sources
Disaggregating the Marine Sector
Nace Code 3.11 3.21 10.2 30.11 30.12 33.15 35.11 38.31 42.91 46.38 47.23 50 77.21/77.34 93 Descrip#on Fishing Aquaculture Processing and preserving of Seafood Building of ships and floa?ng structures Building of pleasure and spor?ng boats Repair and maintenance of ships and boats Produc?on of electricity Dismantling of wrecks Construc?on of water projects Wholesale of Seafood Retail sale of Seafood Water transport Rental and Leasing Services (Marine) Marine Recrea?onal Services (Marine) Data Sources BIM & Survey BIM & Survey CIP CIP CIP CIP CIP CIP BCI ASI ASI ASI ASI ASI Where detailed aggregate information on intermediate
consumption is not available, shares are estimated through
survey and case study
Products Agriculture, Forestry and Fishing Manufacturing Services Total intermediate consump?on Imports and Taxes less subsidies Total consump#on at purchasers' prices Gross Value added Total inputs (=Total domes#c supply row in Table 1) Final Demand Total inter-­‐industry Services Manufacturing Products Agriculture, forestry and fishing Total outputs ( = total domes?c supply in Table 1) Disaggregating the Marine Sector
172 4,321 2,041 6,362 5,346 10,298 86,438 96,736 62,894 71,640 161,650 233,290 68,412 86,263 250,129 336,391 57,568 107,062 36,294 143,356 125,979 193,325 286,423 479,747 107,310 143,066 975 501 638 2,118 2,121 4,240 2,122 3,173 4,451 8,108 15,733 47,373 63,106 33,634 6,362 96,740 233,290 336,391 B C F G H I J K 6,362 L Final Demand Total inter-­‐industry Services Fishing and Aquaculture 975-­‐(A+B+C) A 501-­‐H 638-­‐G 2,118-­‐H 2,121-­‐I 4,240 2,122 Total outputs ( = total domes?c supply in Table 1) Products Agriculture and Forestry Fishing & Aquaculture Manufacturing Services Total intermediate consump?on Imports and Taxes less subsidies Total consump#on at purchasers' prices Gross Value added Total inputs (=Total domes#c supply row in Table 1) Agriculture, forestry and fishing Products Manufacturing Disaggregating the Marine Sector
3,173-­‐M 172-­‐N 4,321-­‐O 2,041-­‐P 6,362-­‐Q M N O P Q 4,451 5,346 10,298 86,438 96,736 8,108 62,894 71,640 161,650 233,290 15,733 68,412 86,263 250,129 336,391 47,373 57,568 107,062 36,294 143,356 63,106 125,979 193,325 286,423 479,747 33,634 107,310 143,066 96,740 233,290 336,391 Future Work
q  Calculation of direct, indirect and employment multiplier
effects in the Seafood Sector (Fishing, Aquaculture and
Processing)
q  Calculation of multipliers for remaining marine sectors to
investigating multiplier effects arising from the
implementation of the Ocean Wealth Strategy
q  Life-Cycle Analysis, investigating the carbon footprint of
marine related activity
Thank You eoin.grealis@nuigalway.ie References and Resources •
O’Donoghue, C. (1997) Carbon Dioxide, Energy Taxa?on and Industry: An Input-­‐Output Analysis, ESRI Working Paper •
Morrissey et al. (2012) The role of the marine sector in the Irish na?onal economy: An Input-­‐Output analysis •
Miller and Blair (2009) Input-­‐Output Analysis •
Miller et al. (2013) An Agri-­‐Food Social Accoun?ng Matrix for Ireland •
Wassily Leon?ef’s Original Paper hip://www.nobelprize.org/nobel_prizes/economic-­‐sciences/laureates/1973/leon?ef-­‐lecture.pdf EC 429 Marine Economics: An Introduc?on to Input-­‐Output Modelling -­‐ Eoin Grealis