A SAM for Europe: Problems and Perspectives

This paper examines the conceptual and practical problems of constructing a social accounting matrix for Europe. It involves integrating the accounts of member countries within a complete system of regional accounts. The standard matrix framework first proposed by Stone is modified in two respects. First, functional and geographical transactions are distinguished between in order to simplify the accounting structure. Secondly, supraregional accounts are more formally incorporated so as to include accounts for the rest of the world and EC institutions, as well as to accommodate distribution and other transaction costs involved in moving goods, factors and assets between member countries. The general system of regional accounts can then be aggregated, consolidated or apportioned across member states but this has implications for both harmonizing accounts and classifications and considering the extent to which there is truly a ‘single European market’. Finally, the paper considers the availability of data and presents a preliminary compilation of aggregate accounts for three member countries.