ABSTRACT
This chapter describes the econometric input-output model for the state of Sao Paulo, Brazil. The Brazilian economy is very concentrated spatially and the state of Sao Paulo is its most important economic area. The chapter describes the procedures adopted for the estimation of regional economic time series. It presents the equations and the basic case projections. The model developed is based on the methodology developed by Conway and further modified by the Regional Economics Application Laboratory of the University of Illinois, with successful experiences of applications for different areas within the US. The chapter analyzes consistency of the results and impacts are calculated for three different types of shocks. The shocks are: a drastic drought that reduces agricultural production by 20" in one specific year; the installation of a new automobile assembly plant; and the stagnation of a traditional sector in the regional economy – textiles.
