He received the 1973 Nobel Prize in Economics for this work. Let xi be the total amount of output needed to be produced by the i th sector to satisfy the demands of all sectors. In reality, there is also demand from nonproducing sectors, such as consumers, government, etc. All nonproducing sectors form the open sector . This matrix equation describes a Leontief open model .
Economists are usually interested in computing the output vector x given the demand vector d .
Also, economists often assume that the levels of production are known and want to compute the demand that can be placed upon the producing sectors. The producing sectors are usually some key industries, such as agricultural goods, steel, chemicals, coal, livestock, etc. For the U.S. national input-output matrix, the open sectors are the federal, state, and local governments. B. Problems 1. Trade Income Consider the international trade model consisting of 3 countries, C 1, C 2, C 3.