ABSTRACT
This chapter shows how the Social Accounting Matrix (SAM) framework can be used to provide the initial conditions and help calibrate an applied general equilibrium model. The genesis of the SAM goes back to Richard Stone's pioneering work on social accounts. The SAM is both a data system and a conceptual framework useful for policy analysis. The chapter provides different applications of, and studies relying on the SAM. The SAM became the basis for the calibration of a general equilibrium model of the Indonesian economy that was used to simulate alternative packages of adjustment policies on economic growth and equity. In conducting structural path analysis the starting point is to equate the notion of expenditure to that of 'influence. The SAM is a comprehensive, disaggregated, consistent and complete data system that captures the interdependence that exists within a socioeconomic system.
