Ghosh Supply-Driven Model

The Ghosh model is the supply-side counterpart to the Leontief demand-driven input-output system, introduced by Ambica Ghosh in 1958. Rather than fixing the recipe of inputs per unit of output, it fixes allocation coefficients — the share of each sector's output sold to every downstream buyer — and asks how a change in the supply of primary inputs (value added) propagates forward to total output. Solving x' = x'B + w' gives x' = w'(I − B)^{-1}, where the Ghosh inverse G = (I − B)^{-1} plays the forward-looking role that the Leontief inverse plays for demand.