Balancing a Social Accounting Matrix: Theory and Application (Revised Edition)
26 Pages Posted: 23 May 2014
Date Written: December 11, 2013
Computable general equilibrium modeling requires a consistent and coherent benchmark data set, most of which is generally organized in the form of a Social Accounting Matrix (SAM). These data generally come from quite diverse sources and correspond to different periods of time. As a result, they often contain inconsistencies. We present a simple computer program that makes it possible to reconcile this information in order to balance a SAM. The program minimizes the changes to the base data using various optimizing techniques, including cross-entropy and least squares. The program is an attractive and easy alternative to the arbitrary and time-consuming manual and other methods generally used to balance SAMs.
Keywords: Matrix balancing, Social accounting matrix, Cross-entropy
JEL Classification: C63, C68, C82
Suggested Citation: Suggested Citation