Sector Systemic Importance Analysis Based On Input Occupancy Output Technique

Since global financial crisis in 2008,systemic risk measurement has become an issue in financial risk management.However,the existing literature focuses on risk among banks,paying little attention to risk between real economy and finance.This paper uses input occupancy output technique,build systemic connectedness among sectors through changes of loan occupancy based on IO(input-output)relationship among sectors.By introducing output and input shocks,this paper defines systemic connectedness indicators and constructs risk transmission matrix to recognize systemic important and vulnerable sectors for finance.In empirical section,this paper extends 2010-2014 IO tables of 42 sectors to input occupancy output tables to compute systemic connectedness indicators and recognize systemic important and vulnerable sectors.Then,based on the panel data of 2010-2014,regress to find factors of systemic importance and vulnerability.Results show most systemic important sectors are manufacturing sectors,especially machinery and equipment manufacturing sectors.They have great impact on loans of other sectors as both input and output sector.Systemic importance is positively related to IO connectedness,intermediate use ratio and intermediate input ratio.Most systemic vulnerable sectors are in the third industry,including real estate.They have weak IO connectedness but high loans.Systemic vulnerability is positively related to loan occupancy ratio,output scale,intermediate use ratio,intermediate input ratio and intermediate financial input ratio.