ABSTRACT
This chapter introduces the notion of the dynamic inverse that could play a role in the empirical study of economic change analogous to the role played in static input-output analysis by the inverse of the flow coefficient matrix. It describes the open dynamic input-output system in terms of a simple set of linear equations. The chapter presents a general solution of that system, that is, the inverse of its structural matrix. Each element of this inverse represents the combined direct and indirect inputs required from the row industry to permit an additional output of $1 million by the column industry. The dynamic inverse is primarily a storehouse of systematically organized factual information. This information is presented in a form particularly suitable for analytical description of intertemporal relations. The individual elements of the inverse can be spun into longer strands, each attached to a given time sequence of final deliveries.
