Compilation of a City-Level & Four-Digit Industry Code MRIO Table Based on Firm-Level Data

Scholars have attempted to compile various multi-region input-output (MRIO) tables for different countries. However, due to the city-level data scarcity and methodology constraints, almost no MRIO table covers a large number of cities with more disaggregated sectors in countries with large economies, such as China. Based on two large-scale firm-level datasets China Annual Survey of Industrial Firms (CASIF) survey and the China Customs Data (CCD) database, from the year 2000 to 2013, this paper takes China as a case study and presents a new compilation method to construct a MRIO table covering 284 prefecture-level administrative cities and 334 four-digit sectors, which is by far the most comprehensive MRIO table with the largest number of cities and the most segmented industries in China. Unlike existing MRIO tables constructed based on provincial single region IO (SRIO) tables, we use information along with various linear constraints implied by sector-level and firm-level statistics. The paper expands the direct decomposition method by developing auxiliary econometric models necessary for estimations and consistency adjustment. In addition, comparative analysis shows the reliability of our method, which guarantees better coherence and comparability with the MRIO officially published by the National Bureau of Statistics of China (NBS). Therefore, our proposed methodology gives the possibility to produce more disaggregated MRIO tables in other similar contexts.