Comment on ‘Interindustry Economics’ by Chenery and Clark

In publishing “Interindustry Economics,” Hollis Chenery and Paul Clark have furnished the profession with a uniquely useful work — both a readable textbook for the beginner, and at the same time a systematic treatise for the input-output practitioner. It is unfortunate, however, that the authors have leaned over backwards to find merits in Leontief’s original model as compared with the activity analysis approach to interindustry economics. Activity analysis provides a convenient framework for handling certain kinds of “conceptual” difficulties — import substitution, processing substitution, labor-capital substitution, and the output of by-products — difficulties that have arisen in any of the empirical applications proposed by Chenery and Clark. On balance, their work provides impressive evidence against the presumption that the collection of data for a square matrix is cheaper than for a rectangular one.