Estimating Average Propagation Length in an Interregional Input-Output Context: A Formal Approach

The average propagation length (APL) is a critical metric for quantifying the complexity of production chains by measuring the average number of steps required for an economic shock to propagate between sectors. While the APL has been widely used in single-region and national input-output frameworks, a formal methodology for its estimation in an interregional context has remained undeveloped. This study fills this gap by presenting a formal interregional APL model derived within the Leontief and Ghosh frameworks. The methodology is empirically applied to Korea’s 2015 interregional input-output table, covering 16 subregions and 30 industrial sectors. The results demonstrate that the interregional model consistently produces higher APL values than the single-region model, as it captures extensive cross-boundary linkages and multi-layered supply chains. Based on the findings, the study derives regional economic policies tailored to the region-specific linkage structure, offering insights for both self-sustaining hubs and intermediate processing nodes.