Discussion paper

DP13953 Production Networks and Economic Policy

In this paper, we show how to combine data on input-output tables and recent insights from the theory of production networks in order to inform policy. We first describe the information contained in input-output tables compiled by statistical agencies, and show how to derive relevant statistics of production networks. We then discuss the implications of production networks for policy intervention in a series of domains, such as fiscal policy, industrial policy, or, finance. Finally, we present a quantitative exercise applied to French data in order to illustrate that production networks shape the overall impact of competition policy on the economy.


Sauvagnat, J and B Grassi (2019), ‘DP13953 Production Networks and Economic Policy‘, CEPR Discussion Paper No. 13953. CEPR Press, Paris & London. https://cepr.org/publications/dp13953