The networked input-output economic problem

Abstract: In this paper, we formulate an input-output economic model with multiple interactive economic systems. The model captures the multi-dimensional nature of the economic sectors or industries in each economic system, the interdependencies among industries within an economic system and across different economic systems, and the influence of demand. To determine the equilibrium price structure of the model, a matrix-weighted updating algorithm is proposed. We prove that the equilibrium price structure can be globally asymptotically achieved given that certain joint conditions on the matrix-weighted graph and the input-output matrices are satisfied. The theoretical results are then supported by numerical simulations.