nm1108: let me start by telling you two preliminary things er first of all [0.
4] i plan to do this today in one blow in other words [0.9] no [0.2] time [0.2] 
out [0.5] i will just speak for roughly [0.6] one hour and [0.2] and a half er 
bit less [0.7] i have to be at another classroom er [0.8] at ten-thirty so er 
[0.2] i'll kind of finish the whole thing w-, in one hour and a half [0.9] 
second you see that there is a piece of er equipment here [1.0] er namex is 
from the er Language Studies [1.1] and she is concerned with language used in 
classrooms one of the er [0.3] reasons for this is [0.2] that we [0.4] have an 
increasingly large number of international students [0.7] and this is a perfect 
class for this you come from at least fifteen different countries to the best 
of my knowledge [0.7] er which is really quite wonderful for a group that is 
not so large [0.8] and if you take me into account er [0.2] another non-U-K 
person then it's really wonderful [1.3] er [1.0] so this is a good example that 
they can use also to help [0.3] students understand [0.4] what kind of language 
is used in classes 
and stuff like this [0.3] so this has nothing to do with B-B-C or anything of 
that sort it is just an internal research project [2.1] okay er [0.4] what i'm 
going to do today [0.7] is based on this [0.6] two-sheet thing that i gave you 
the first time we met [0.7] which [0.2] sets out my four sessions on [0.3] say 
macroeconomic aspects [0.4] of [0.2] international construction [0.5] i told 
you that namex and i [0.3] divide this job roughly along micro [0.6] and 
macroeconomic lines [0.2] he's dealing with construction projects and firms 
largely [0.2] and i'm dealing largely with [0.4] er issues of countries [0.3] 
and [0.2] the role of the construction sector as a whole [0.3] in this business 
[1.8] in con-, in in in you know the the national economy as a whole [0.6] now 
[2.3] by chance er [0.7] at the beginning of this year i got this book from the 
publisher and a number of you have purchased it but it's available in the 
resource room [0.3] and the library's supposed to have it so you then don't 
have to buy it [0.3] but almost everything that i will be saying [0.5] er in 
these four sessions [0.2] is in this book [0.8] er also 
by chance another book came out [0.4] er which looks like this [0.3] and it is 
called The Future of International Construction it's a bit closer to what we 
are doing here by title [0.4] but it actually contains only the results of an 
international survey [0.3] that i run from year to year [0.2] okay [0.2] so 
this book now [0.4] er contains [0.3] summary results from this survey from 
nineteen-ninety-two [0.3] to nineteen-ninety-eight [0.6] year nineteen-ninety-
nine will appear [0.2] in a paper [0.3] that [0.2] the same fellow [0.2] whose 
name is namex [0.5] and myself [0.2] have written [0.3] and will publish in 
Building Research and Information [0.3] one of the key [0.2] journals in our 
field [0.5] though remember namex is my PhD student [0.5] and we have another 
PhD student here i'm sorry namex to bring you out like this [0.6] er namex from 
Mexico if you add yet another country er [0.2] er [0.3] wonderfully to added to 
our er mix [0.3] i like er international [0.2] classes myself [0.3] so it's 
really wonderful to [0.3] see somebody from Mexico as well [0.8] namex is now 
working with me on you 
know related things having to do with international issues and construction [0.
5] and one day she will probably write a book with me on something of this yeah 
[0.3] just like namex [0.3] 
sf1109: [0.6] 
nm1108: now these two books are available for purchase i'm going to er send 
this around this will tell you a little bit about this new book [0.8] 
unfortunately remember i have nothing to do with prices of these things this 
thing costs forty pounds [0.3] which is idiotic but that's what they want for 
this [0.4] i get it at a discount [0.3] so [0.7] we are selling it to you for 
thirty-two pounds that is the discount [0.2] you know er nobody's making any 
money in this [0.2] and similarly [0.2] this costs fifty pounds and we are 
selling you at the discount that i get it at [0.3] which is forty pounds [1.0] 
okay so we bought these books [0.2] in order to be able to pass them to those 
of you [0.3] who actually want to buy them [1.2] okay [0.2] now [0.5] the 
syllabus doesn't tell you which pages of this book you should go to but it 
tells you which papers [0.4] are assigned for 
today's readings yeah [0.7] so er you should er always be able to tell exactly 
what is assigned reading for a particular day [0.7] this is not assigned at all 
but you will notice that i will be talking about the survey on a number of 
occasions [0.2] and whenever i talk about the survey this is the relevant book 
as well [1.1] okay these are the preliminaries [1.4] er even though it is 
relatively difficult to see this er [0.4] you will see that i will always put 
[1.3] on the overhead projector [1.1] a transparency telling which paper i'm 
dealing with or which chapter [0.2] okay [0.2] so this is chapter fifteen The 
Future of International Construction [1.2] and er that's a paper that is now 
reproduced in the book [0.2] but the paper is listed [0.7] in the syllabus [0.
2] and it also tells you you can see this [0.4] two-hundred-and-seventy-five 
there's the page where you will find it in the book [0.2] okay [0.5] i'm sorry 
for being a bit like er you know talking [0.3] to kids er but [0.2] i'm just 
trying to make sure that you understand exactly what i'm trying to do [1.6] now 
remember [0.6] this paper 
is something that was originally [0.5] given [0.2] in year nineteen-ninety 
exactly ten years ago [0.8] and it was something that was originally discussed 
[0.9] in [0.4] draft form in Sydney Australia the big conference on 
construction [0.6] er with many people around the world present [1.2] er that 
was an attempt at that time for me to generate discussion within [0.6] a 
working commission of C-I-B [0.6] which is the French acronym for [0.5] 
International Building Council [0.6] C-I-B [0.3] International Building Council 
is one of the largest institutions in the world dealing with research [0.4] 
into all kinds of issues [0.3] relating to construction [1.6] now [0.2] C-I-B 
working commission [0.5] W-fifty-five [1.2] in [0.2] building economics is one 
group that i have been a a part of for many years [0.5] we tried [0.2] to 
generate discussion by writing a draft of this particular paper [0.2] and 
giving people some ideas of how i perceive [0.5] the role of construction in 
national economic [0.7] culture [0.8] how does construction relate to an 
economy [0.3] and how does it change [0.3] over different stages of 
economic development so this is what this paper is about [0.4] but also 
remember [0.6] that this paper was finally [0.3] published in nineteen-ninety-
one [0.4] and it was then the basis for the survey [0.6] which is published 
here [0.2] which was started in nineteen-ninety-two [0.7] a number of my 
colleagues [0.8] from various countries [0.3] felt a bit uneasy about some of 
the propositions that i was proposing at that time [0.3] and i said fine let us 
try to see [0.2] what an international survey of these issues will tell us [0.
8] and er then i decided to do it on an annual basis to see [0.2] to what 
extent people agreed with some propositions [0.2] which actually come from this 
paper [0.2] and then [0.2] to see how that agreement or disagreement changed 
over time [0.2] so that's basically the story [0.2] so next time [0.2] we are 
going to be talking about the survey and i will present you the results [0.5] 
of your [0.6] responses i i have analysed in some simple way [0.2] your 
responses to the survey which i collected the first time we met [0.7] okay [0.
3] so that's that's that [0.2] now remember [0.2] in 
general i not only do not mind but i like when i'm interrupted [0.3] okay [0.2] 
i know how to deal with interruptions of any kind [0.2] express your opinion [0.
5] freely [0.3] er tell me that you disagree [0.3] give me arguments [0.3] 
don't be rude [0.6] be nice [0.3] but say whatever you wish yeah [0.3] feel 
free to talk [1.3] er that's a good habit to establish as early as possible [0.
4] in [0.8] undergraduate or graduate education [1.7] the first proposition 
that i would like to put forward [0.9] in dealing with this question how does 
construction fit into a national economy [0.3] and how does that role change 
over time [0.4] is one of the main [0.4] drivers [0.3] of change [0.2] in any 
society [1.3] at least [0.3] at our stage of economic development [0.6] and 
that is [1.0] the drive associated with urbanization and industrialization [1.
7] these are things that happened in this country [0.4] roughly [0.3] starting 
[0.2] two-hundred years ago [0.2] until [0.2] roughly [0.5] hundred years ago 
[1.1] er [0.7] but perhaps you know these numbers are too rough [0.3] it took 
something like hundred-fifty years in this country for [0.2] urbanization and 
industrialization to 
take place [0.6] now what happens in this process [0.5] er let me first tell 
you what these things are [0.3] L-D-Cs are less developed countries [0.4] N-I-
Cs are [0.2] newly industrialized countries [0.3] and A-I-Cs are advanced 
industrial er industrial countries [0.2] or if you wish post-industrial 
countries which [0.7] emphasize services much more than before [1.0] what we 
have on the vertical axis of this diagram [0.4] is [0.2] the share of urban 
population in total population [0.2] that is some simple measure of 
urbanization [0.7] this country would be some place in the eighties or nineties 
[0.4] in percentage terms [0.6] 
a country like Ghana [0.2] would be in the fives tens fifteens [0.3] yeah [0.3] 
so you start some place around [0.3] ten fifteen and end up some place around 
[0.3] eighty-five ninety per cent [0.3] because population never will be fully 
urbanized [0.3] some people would be [0.3] in [0.2] er areas which are less 
dense [0.2] so this process [0.2] from this point [0.3] to that point in the 
case of [0.2] Great Britain [0.5] took something like a hundred-fifty years 
very rough numbers [0.3] okay [0.2] but for example in China [0.3] that process 
will take [0.2] roughly fifty years [1.1] so you can imagine [0.3] that the 
same diagram applies [0.2] but the time [0.3] dimension shrinks [0.4] so 
economic development if you wish is ever faster [0.3] and one reason for that 
is that people are copying other people [0.3] there is no reason for the 
Chinese to invent [0.2] an elevator motor [0.2] it exists copy it [0.9] as long 
as you can copy [0.2] you can develop very quickly [0.8] because everything 
exists [0.2] you see we have to figure out how to make it in Beijing [0.3] and 
not [0.3] in [0.2] i don't know [0.4] Idaho [2.0] so 
what happens here is that we have something that is known as a sigmoid [0.7] or 
logistic curve [0.2] an S-shaped furve [0.2] er curve [0.2] which says [0.2] 
that in early stages [0.2] of urbanization and industrialization [0.5] 
population [0.3] goes to cities at an increasing rate [0.8] hits an inflection 
point [0.3] and then [0.3] goes to cities [0.3] at a decreasing rate [0.4] and 
the whole thing evens out at some value [0.4] yeah [0.4] so that is one of the 
main drivers [0.3] people are coming from rural areas into cities [1.3] that is 
not happening any more [0.2] in the United Kingdom [0.5] that is happening in a 
very major way [0.2] in Malaysia [0.8] in Thailand [1.0] in China [1.0] and it 
is not yet happening in many parts of Africa [0.4] people are still in villages 
[0.2] they're still not going to [0.6] cities [0.2] even though obviously in 
many countries in Africa you have that process already [0.2] Nairobi's a big 
city et cetera [1.2] so this is one of the main drivers [0.2] this shift of 
population [0.2] shift of pop-, of population from [0.2] rural [0.2] to urban 
areas [0.2] drives [0.2] the process [0.2] of [0.4] er construction [0.6] okay 
[0.5] er it is one of the 
main drivers of that process [0.3] now [0.6] if it is correct to say [0.3] and 
i can tell you urban geographers and demographers will tell you that that curve 
[0.3] generally speaking [0.7] holds for any particular country [1.6] then it 
stands to reason [0.9] that the role of construction [0.6] in a particular 
country shifts this way over time [0.3] let me explain what this is [1.1] now 
this is a share of construction in G-N-P [0.5] G-N-P is the [0.2] total output 
[0.2] generated in a country [0.2] in one year [0.9] Gross National Product [0.
7] the share of construction in G-N-P is a percentage [0.7] early on in 
economic development that percentage is quite low [0.3] say five per cent [2.2] 
at the top [0.2] of this cycle [0.9] when a country reaches the newly 
industrialized country status [0.5] say Mexico today [0.3] or Turkey today [1.
0] then [0.2] you get something like fifteen to twenty twenty-five even per 
cent of G-N-P [0.5] is contributed by construction [0.9] and then it declines 
again [0.4] to [0.2] again something like five per cent so there is no paradox 
then in a country like Ghana [0.2] and in a country like United Kingdom [0.2] 
you have the 
same share of construction [0.3] in total output [0.5] because [0.3] many many 
things are already in place roads are there [0.3] buildings are there [0.3] 
schools are there [0.2] ports are there [0.7] everything is there but you need 
to maintain it and so on [0.3] you add a little bit [0.2] you destroy an old 
building and put another one in there you take an old bridge down and put 
another one there [0.2] but nevertheless most of the stuff is there and people 
are not moving around any more [1.4] so [0.3] in L-D-Cs and A-I-Cs [0.4] you 
would expect roughly the same [1.1] shares of construction in G-N-P [0.3] 
whereas [0.7] newly industrialized countries would have very high share [0.2] 
because [1.2] concrete is being poured right now [0.8] industrial capacity is 
being put in place but with it housing schools everything is happening at the 
same time [0.2] enormous reconstruction [0.4] er benefits from that kind of 
thing [0.7] now i haven't mentioned so far what is on the horizontal axis [0.2] 
i mentioned time [0.4] but actually the measure that you see there is G-N-P per 
capita [0.5] in other words total 
output divided by total population of a particular country [0.6] it is a 
measure [0.3] of [0.5] economic development [0.7] it is not a measure of 
economic well-being [0.8] but [0.3] it is sometimes [0.9] taken to be you know 
economic development is taken to be [0.3] er a kind of measure [0.4] of well-
being [0.4] people are better off [0.2] when [0.2] G-N-P per capita is high [0.
4] in some countries in the world that number is now [0.2] six seven eight ten-
thousand dollars per [0.5] inhabitant [0.5] in some other country it is five 
six-hundred dollars [0.2] so there's a huge range [0.3] in which er countries 
fall [0.7] but nevertheless you can expect [0.5] that if this is so [0.6] and 
that's the next er [0.7] diagram [0.7] that [0.3] you will actually over time 
[0.2] experience a shift [0.7] in the same direction [0.8] so [0.3] i have the 
same diagram [0.2] but here i say time and not G-N-P per capita [0.4] why [0.2] 
because under quote unquote normal conditions [0.7] a country [0.3] would be [0.
2] developing [0.5] but there is no guarantee that a country will be developing 
[0.3] a country may be stagnating [0.2] a country may be going backwards [0.3] 
in many parts of the world 
today we have civil wars [0.3] and different stages of development [0.5] you 
know in ex-Yugoslavia where i originally come from [0.2] er there is a civil 
war still [0.2] kind of simmering in the background [0.2] and obviously [0.4] 
not too many people are building there [0.3] there are no tourists on the coast 
even though there is no war there [0.3] but [0.2] because there are no tourists 
there are no new hotels added or not too many [0.2] et cetera [0.4] but [0.2] 
in some countries civil war is going as we speak Sri Lanka is a good example 
but the Sudan is another [0.3] so in many of these countries the process of 
economic development is moving backwards [0.6] so you can basically use the 
same graph [0.4] but looking backwards you know that is what would happen [0.2] 
everything will be sliding down [0.3] everything will be declining [0.2] yes [0.
3] 
sm1110: just ask like er [0.4] you say that all the [0.2] the [0.3] say all [0.
6] most countries now are [0.3] or half the countries [0.3] some of whom are N-
I-C and some of whom are A-I-C [0.2] but what happens when [0.4] all countries 
which A-I-C [0.7] does that mean that the G-N-P [0.6] will [0.3] go down [0.7] 
nm1108: okay in other words you are saying [0.6] what you are talking to us 
about right now [0.2] has to do with a particular process which will at some 
point end [0.3] yeah [0.5] and what will happen then [0.5] er the answer is i 
have no idea [1.8] i am and 
you know i'm saying er in a number of introductory parts of this paper [0.3] 
that i'm actually covering a period of roughly twenty-five years ahead [0.8] 
why [0.2] that's one generation [0.5] it is still possible to think [0.2] 
approximately twenty-five years from now one generation [1.4] but most of the 
data that i'm using in order to make these kinds of arguments go back fifty to 
hundred years [0.6] two [0.2] to four generations [0.2] so it gives me some 
feeling [0.3] of how these things may be played out [0.7] now it is really hard 
to say [0.2] what will happen if we assume [0.4] that the level of development 
around the globe [0.2] say fifty years from now hundred years from now [0.2] 
will be generally uniform [0.8] will be generally like the U-K today [0.8] what 
will happen then [0.8] i don't know [0.8] i understand this particular process 
[0.2] because it is still [0.3] moving [0.3] i can see what is likely to happen 
up to some point [0.3] but after that it's relatively difficult to say [0.9] 
however you know many economists would say that the process of economic 
development will probably never end in that 
sense th-, there will be always some approximation [0.4] er to equality in 
different parts of the world [0.3] there may be some movements some parts will 
be going up some down people will be shifting around [0.8] just like in this 
country [0.3] you know for example Manchester Liverpool [0.2] were very 
important industrial centres people moved there to find work [0.3] now they're 
moving out [0.2] which doesn't mean that these places are going to hell it 
simply means that the industrial employment of the type that [0.6] they had 
before [0.2] are simply [0.4] now being changed [0.3] and there is a process of 
transition [0.3] so we may have things like this [0.3] but the main forces [0.
3] of urbanization and industrialization [0.2] will have been played out [0.3] 
say [0.2] by fifty [0.2] hundred years from now [0.6] okay [0.3] and at that 
point [0.2] some other theoretical framework will be needed [0.2] to explain 
what is going on and why [0.7] yeah [1.6] so what i'm saying here is [0.6] 
because in a normal situation in which there is no war there is no economic 
decline due to [0.4] er earthquake or you know [0.2] case of Turkey [0.3] er 
possible case of Japan we never know when that will happen but Tokyo is a 
tremendous risk [0.2] and not only Tokyo [0.2] huge concentration of people [0.
3] in California [0.2] is also continuously at risk and may actually take 
people [0.5] back into [0.3] er previous stages of economic development [0.2] 
if something bad happens [0.2] which will happen the question is only when [0.
9] so if that is true [0.6] then i am arguing [0.6] it is also possible [0.7] 
that not only the share of construction [1.0] in G-N-P [0.4] but that the 
volume of construction [0.2] actual volume [0.4] would also peak [0.4] would 
reach some point [0.7] and then start declining [0.4] in 
other words [0.2] there will really be fewer pounds and yen [1.3] and dollars 
spent on a on construction [0.5] having taken care of inflation [0.5] and in 
other words the value of yen [0.4] dollar [0.2] and pound [0.8] yes namex [0.5] 
sf1109: [0.2] er [1.1] well we couldn't [0.2] we wouldn't be able to generalize 
that for all type of er all types of countries [0.5] both er let's say for less 
developed countries [0.7] you still have a lot of population [0.6] drawing you 
know [0.5] height rate of er [0.2] population growth [0.4] secondly [0.7] 
perhaps the the [0.4] if [0.9] if this process of the government stops it could 
be because of the economic crisis [0.5] not exactly because of the [1.1] of the 
process of [0.9] a lot of people [0.2] going to the cities and [0.2] things 
already being built there 
nm1108: mm [0.2] 
sf1109: and er no no need for building more [0.7] so [0.3] er 
nm1108: no i i agree i agree with what you're saying but i would also say that 
you know what i have in mind in this particular case [0.4] are countries like 
er the U-K like er Holland like Denmark [0.2] 
sf1109: yeah [0.3] 
nm1108: er [0.2] by the way the U-K 
er was America hundred years ago [0.2] this was the most developed part of the 
world er [0.2] hundred years ago [0.6] er this was the place where people would 
go to do anything not just to build obviously [0.7] er but [0.2] you know at 
some point [0.2] er because this country started the process of industrial 
development first [0.8] that [0.4] process kind of played itself out [0.3] 
sf1109: mm 
nm1108: to a great extent [0.3] now the economy's based on completely different 
things [0.2] you all know about e-commerce and things like this it's based on 
something quite different [0.4] er this is a typical post-industrial [0.3] er 
if you wish economy [0.4] but Denmark is even farther ahead you know there are 
even fewer [0.3] reasons to expect that Denmark will change very much from [0.
6] now [0.7] to i don't know twenty-five years from now so [0.2] some of the 
economists who agree with me [0.2] that even volume may decline would be coming 
from countries like Denmark [0.7] okay [0.2] where they don't expect [0.3] 
significant [0.2] change any more [0.2] and they expect the volume to be coming 
down [0.5] now obviously i'm 
talking about so-called secular or long term threats [0.2] i'm not talking 
about cyclical behaviour of the construction industry [0.2] that follows the 
business cycle [0.7] business cycles [0.3] depending [0.4] on many 
circumstances [0.2] would be between [0.2] traditionally [0.2] three-and-a-half 
and five years [1.1] now [0.2] the last two business cycles were [0.2] a bit 
longer [1.7] but nevertheless business cycles are short term [0.4] you have 
everything [0.2] or almost everything going up then collapsing then going up 
again [0.2] so i'm not talking about that cyclical behaviour [0.2] that will be 
going around this thing [0.3] yeah [0.2] i'm talking about [0.3] the average [0.
4] that is moving in some smooth way [0.5] it is very difficult to actually 
demonstrate that anything like this is going on statistically [0.3] because we 
don't possess good enough data [0.2] for many countries [0.3] to make such 
claims [0.3] but you will find if you look into this book [0.2] er [0.2] you 
will find diagrams which actually suggest these kinds of things [0.4] i cannot 
find it right now [0.5] or i will [0.7] er there is a 
diagram on page thirty-one by the way [0.3] you cannot see it terribly well but 
there is a curve that looks like this and there are many countries plotted [0.
4] er less developed [0.2] newly industrialized [0.2] and advanced industrial 
countries [0.4] but statistical evidence for anything like this [0.2] is hard 
to agree with people because you [0.2] you are talking about [0.2] a 
statistical cloud of points [0.2] which can be interpreted many different ways 
[0.8] at any rate [0.5] er [0.9] i personally believe that if we have a long 
term decline of the share of construction in G-N-P [0.2] you would ultimately 
have [0.2] a volume decline it cannot just go on for a very long period of time 
[0.2] and this is something that i will try to argue right now [0.6] it is in 
the text i don't have any pictures so let me er try to do it [0.3] by just 
talking to you about this [2.2] people [1.1] typically [0.2] will tell you [0.
5] that [0.3] those sectors of the economy [0.4] where employment is dropping 
[0.8] do not necessarily produce less output [0.2] because employment is 
dropping because productivity is going down [0.6] 
let me show you er [0.4] then i'll skip er the the next er [0.2] diagram for 
the time being [0.7] er here is a diagram that shows er employment share [0.2] 
of agriculture [0.2] services in industry [0.5] according to a number of 
serious economists who have looked over one-hundred years to see [0.3] how 
employment for example [0.3] shapes up [0.3] for [0.3] these broad categories 
of economic sector [1.5] in agriculture the drop [0.3] corresponds to [0.2] an 
incredible increase in productivity [1.3] by the way [0.4] the construction 
sector around the globe but especially the United States which is still the 
most productive society on this planet [0.7] way more productive than Japan [0.
7] which is catching up with United States but still [0.8] the productivity [0.
3] not the rate of change of productivity [0.4] of most American workers is 
tremendous by comparison with most [0.2] Japanese workers [0.7] er [0.2] the 
change is sli-, somewhat different but in the last couple of years [0.5] the 
productivity increases in United States have also increased unbelievably [0.6] 
so that [0.2] we have an incredibly productive society [0.2] 
still [0.3] agriculture [0.4] is the soci-, is the sector of the national 
economy in the United States [0.2] that has shown [0.2] greatest improvements 
in productivity since the war [0.5] er by the war i mean the Second World War 
[1.2] er [0.8] now [0.3] i can tell you [0.4] in this particular diagram [0.3] 
which comes from the work of one great economist whose name is er [2.2] er 
Angus Madison Madison he's mentioned in the in the text [0.5] this [0.2] bit 
which is called industry actually combines manufacturing and construction [1.4] 
he sees a very tight relationship between manufacturing and construction [0.2] 
and i agree with that particular po-, er position and we will [0.2] talk about 
these things later on in this course [0.8] he says [0.2] that industry 
experiences [0.2] this kind of growth up to a point of employment in industry 
and construction [0.2] and then it starts declining [0.5] we know we know that 
manufacturing is the second major [0.7] beneficiary [0.2] of [0.3] productivity 
increases in United States and in other parts of the world [0.3] agriculture 
and then manufacturing tremendous increases [0.8] now i can tell 
you one thing [1.5] the construction sector [0.5] in most countries according 
to all serious studies and especially in United States [0.4] shows no 
productivity increases since Second World War [1.0] no productivity increases 
[1.9] it is staggering [1.0] and normally you know many of us who analyse the 
construction sector [0.3] would say [0.6] that [0.2] that doesn't take into 
account the quality of buildings and so on we don't do things this way any more 
[0.5] we spend much more money on various kinds of electrical mechanical [0.2] 
and electronic systems [0.3] we don't just take [0.3] bricks and morta-, mortar 
bus-, er buildings like this one [0.8] but nevertheless [0.3] anybody dealing 
with any other industries say I-T-related industries will tell you [0.4] that 
[0.2] quality changes there are staggering by comparison with construction [0.
5] so construction is one of the sectors that [0.3] typically [0.2] in any 
serious study comparative or just for one country [0.2] comparing different 
sectors and industries [0.3] shows no productivity increases or slight negative 
[0.3] productivity 
increases [0.3] in other words [0.2] drop in productivity [1.5] these are facts 
[0.5] so [1.1] it is also a fact [0.4] that the number of people working in 
construction [0.3] in advanced industrialized countries [0.5] is dropping [1.0] 
we have very strong data about that [0.3] the more developed the economy [0.3] 
the less people work in construction [0.7] from one point to another however 
you compare it over time [0.8] it is dropping [0.8] if productivity is not 
increasing [0.4] where is the volume of construction going to come from [0.9] 
sf1111: maintenance and repair [0.4] 
nm1108: i'm sorry [0.4] 
sf1111: maintenance and repair [0.3] 
nm1108: yes possibly and that's why i had this er diagram here [1.0] on the 
previous page [0.8] you know saying that [1.2] subsectoral share [0.5] in total 
construction which will be new construction and then maintenance and repair [0.
3] is changing over time [1.0] so new construction may be dropping [0.6] but 
maintenance and repair is increasing [0.8] again i will be talking to you about 
this again but [0.6] er [0.3] er i have studied together with a colleague from 
the United States i have studied maintenance and repair 
vis-à-vis [0.2] new construction in United States [0.6] it is still a very 
small proportion of er total construction there [0.2] it is something like 
thirty per cent [0.6] in this country it is believed to be something like [0.5] 
forty to fifty per cent [1.5] er maintenance and repair [0.4] out of total [0.
8] but [0.3] we see [0.3] that maintenance and repair construction is actually 
much less capable [0.2] of moving the rest of the national economy [0.3] than 
[0.2] new construction [0.6] so i like to say that maintenance and repair 
construction [0.3] can provide a lower bound on the drop of construction 
ability [1.3] you know you will always have [0.2] replacement of some 
facilities [0.2] you will always have an increasing amount of maintenance and 
repair [0.3] but that is a declining [0.7] thing nevertheless [0.2] in most of 
the economies we have studied [0.4] this economy in particular [0.2] but [0.3] 
again [0.2] countries like Denmark and so on would show [0.4] in very high [0.
9] er er development [0.2] er er environments [0.3] that construction is 
basically a declining sector [0.3] in volume terms as well [1.0] now i am 
stressing all this because many of my colleagues construction economists 
disagree with this proposition [0.8] they agree with the pr-, er the previous 
one [0.6] that [0.6] the share of construction in G-N-P first goes up and then 
comes down [0.4] but that volume first comes down and then comes down [0.2] 
later on [1.2] most of my colleagues disagree [0.3] about [1.0] and that is 
therefore something that we will see you know that is a proposition [0.3] that 
i am putting my name behind [0.5] and one day it will be the proven [0.2] er [0.
3] correct or incorrect [0.3] but for the time being [0.3] i don't see any 
strong reasons [0.2] to believe that these things would not continue [0.2] to 
look like they do [1.9] the survey which i will discuss with you next time 
indicates [0.2] that people disagree with that proposition and that's 
interesting [0.4] you know that's interesting and normally i have to listen to 
this [0.2] i have to listen to [0.4] the [0.3] common sense [0.7] within my own 
professional [0.2] group [1.6] now [0.2] this diagram is a kind of a [1.6] 
taking on taking on of the previous one [0.2] saying [0.4] that [0.3] if i'm 
correct about what i am saying right now we would expect something like this 
with countries [0.3] which [0.2] today [0.3] today have the status of [0.3] 
less developed [0.6] newly industrialized [0.3] or advanced industrial 
countries [0.9] in other words [0.2] that we can expect to that today's L-D-Cs 
will [0.4] continue [0.2] increasing their volume [0.6] of 
er construction [0.2] volume not share only [1.1] that NICs [0.6] would at some 
point reach [0.5] some kind of peak and then decline [1.1] in volume [0.2] as 
well [0.8] and that today's A-I-Cs [0.4] will [0.3] at some point start 
experiencing this kind of growth [1.5] so [0.4] er that is a kind of summary of 
all these diagrams [0.3] now let me tell you something about these diagrams 
which i didn't mention before [0.3] they are obviously not meant to show any 
mathematical relationship [0.8] they are [0.3] ideograms [0.3] something goes 
up and comes down so i call [0.3] this kind of curve [0.2] i call it simply [0.
2] U-shaped [1.1] that curve i call S-shaped [0.7] er [0.2] et cetera [0.2] in 
order to show [0.2] the basic relationships [0.3] if you would actually want to 
draw these things more correctly [0.3] you would probably 
have [0.4] er something like an incline here and a [0.4] you know some kind of 
[0.3] er ramp [0.3] taking you down to some kind of value [0.2] obviously 
doesn't go from zero up and then down to zero [0.2] it comes to some asymptotic 
value [0.3] what was some value that it approximates in the long run [0.6] but 
this is simply [0.2] a simplification [0.3] to give people a clear picture of 
what's going on [0.5] these things would [0.2] make the whole thing [0.2] er er 
too complicated [0.2] to understand [1.5] the next point in my argument is [0.
2] like this and this directly relates to the whole question of international 
trade [0.4] in construction activity [1.7] in other words international 
construction as such [0.7] i'm saying that present [0.2] patterns of 
international trade [0.4] in construction services [1.4] to a great extent 
construction materials as well [0.3] but mainly construction services [0.2] 
looks like this [0.4] the L-D-Cs are recipients of trade from [0.2] advanced 
industrial countries [0.5] but also from [0.4] newly industrialized countries 
[0.7] er [0.3] even ten years ago this was very difficult for people to 
understand [0.6] even 
ten years ago [0.4] you know i had to strain [0.2] to explain to people that 
remember [0.2] only ten to fifteen years ago we would think about Japan as a 
NIC [0.8] and not as an advanced industrial [0.5] country [0.6] which it is 
recognized to be today [1.2] i now don't have to strain so much because [0.3] 
it is a fact that many Japanese [0.3] companies have done extremely well [0.2] 
in the United States and Europe [0.2] and basically left [0.2] many of these 
people are not as interested as they used to be [0.2] in these kinds of markets 
[0.4] they are [0.5] interested in some niche markets but basically they are 
not [0.5] at a stage of economic development where that is very interesting for 
them [0.8] however [0.4] we have here we have China here which ten years ago 
nobody would imagine [0.4] that Chinese construction companies would be [0.2] 
building [0.2] relatively far from home very complex projects [1.6] at that 
time [0.2] ten years ago it would be surprising that Pakistani companies are 
building these kinds of things [0.2] not just Italian companies [0.3] you know 
building dams [0.2] in their region but 
nevertheless quite far from home [1.1] Turkish companies are building in Moscow 
[0.3] i mean there are many things of that sort which are quite different today 
and i don't have to explain as much [0.4] what i expect to see in the future [0.
7] so [0.6] this is the situation that we have right now [1.3] that actually 
there is some trade cross-trade going between NICs A-I-Cs [0.9] er remember 
South Korea is still classified as a NIC [0.8] and not as an advanced 
industrialized country [1.0] Japan is [1.2] and China is a NIC only [0.5] on 
the two seaboards [0.3] but inside it's an L-D-C [1.0] if you go to China 
you'll see [1.0] totally rural pastoral areas in the middle of the country [0.
4] there are people [0.4] you know carrying things like this in buckets [0.7] 
on construction sites [1.9] er and you can actually see just humans building no 
machinery no nothing [0.3] in very large part of China [0.4] on the seaboards 
obviously it's exactly the same as in Canada there is no difference really [1.
5] now i'm saying [0.2] if i take this part of the picture to correspond with 
the 
beginning of my diagram that i just showed you [0.4] in other words those curve 
[0.3] A-I-Cs going down NICs going like this in volume [0.3] and L-D-Cs going 
up [0.3] and i now that's the beginning of that diagram [0.2] and now this is 
the end of the diagram [0.6] i'm saying [0.3] today's today's L-D-Cs [0.2] they 
will not be L-D-Cs that [0.2] well you know they'll be in the future [0.3] but 
today's L-D-Cs [0.4] will be [0.4] building in A-I-Cs [1.8] they will and and 
[0.3] t-, [0.2] today's NICs will still be building in a-, A-I-Cs [0.2] there 
will be trade between these [1.1] 
sf1111: what is it what would be the ou-, [0.2] the output of A- [0.4] I-C [0.
7] 
nm1108: well [0.3] some niche markets obviously you know nuclear reactors er it 
is not that easy to actually think up that kind of technology [0.4] and it 
depends on very special equipment [0.2] because a nuclear reactor is not a 
building a nuclear reactor is a piece of equipment [0.5] in a shroud [0.6] yeah 
[0.4] and you know modern reactors are like this they they just have a little 
bit of concrete around them [0.6] er but generally speaking [0.3] it is 
equipment that you are selling [0.3] and the shroud is relatively simple to 
build [0.4] so [0.5] er i would expect [0.3] much of this much of this to be 
internal [0.7] i would expect much of this to be internal and some niche 
markets do actually exist [0.3] yes [0.3] 
sm1110: like er [0.6] it's [0.3] [0.5] L-D-Cs [0.3] A-I-Cs economy stabilized 
and [0.3] probably then [0.2] L-D-Cs [0.5] then [0.2] how can an L-D-C [0.3] 
actually doesn't seem to make much sense 
nm1108: no no no but but this is this is not Sri Lanka today [0.6] you know 
this is er say er [0.3] you know Sri Lanka er [0.2] twenty-five years from now 
[0.6] 
sm1110: 
nm1108: yes so it's L-D-C today's L-D-Cs so many years later [0.2] at the end 
of the diagram [0.2] which is roughly twenty-five years from now [0.3] 
sm1110: so er 
nm1108: and you know how it happens er [0.5] you know the-, these these 
questions er [0.7] you know at the beginning of this kind of trade what you er 
had [0.3] for example you will have in Saudi Arabia [0.3] you will have 
Pakistani [0.3] er labour [0.2] groups [0.5] organized by one guy [0.3] brought 
there [0.2] and then they would be working under supervision [0.2] of a 
Canadian firm [1.1] but now what is happening is that these Pakistanis are 
working for a Pakistani company because they can build a road as well as 
Canadians [0.9] and Canadians don't want to spend so much time in Saudi 
Arabia [1.0] so there are many reasons for this but nevertheless [0.3] 
Pakistanis are capable of doing it [0.3] and they're now doing much more than 
just providing labour [0.4] the same thing with Turks [0.4] you know [0.2] at 
some point you had Turkish [0.5] crews [0.2] working in a number of different 
countries in the broader region [0.2] but now [0.3] they are run by Turkish 
construction companies they're not big construction company run by somebody 
else [0.7] yeah [1.0] so you have many things of that nature which are now 
happening [0.3] er in Eastern Europe er or [0.2] closer to Central Europe you 
would have Polish companies now building in [0.2] Germany [0.3] originally it 
was simply Polish crews [0.2] run by a German company [1.6] so there are many 
changes of that sort i know that for example there there you know similar 
things [0.8] in the fringe countries [0.2] that used to be called [0.3] Eastern 
European countries now they like to call themselves Central European countries 
[0.3] but all of these countries Poland [0.4] er Czechland Slovakia and so on 
are providing many of these 
kinds of things [0.5] now remember [1.1] i'm not saying [0.5] that [0.2] one 
day in the future nobody in the U-K or Denmark will be building [0.8] i'm 
saying that the international trade would probably not go out that much because 
people would prefer to do something else [0.4] why be a mason [1.0] who wants 
to be a mason [0.5] which is similar to saying who wants to be working on some 
assembly line [0.5] in a Japanese plant [1.9] if the Japanese want to do it 
fine but most likely Malaysians will want to do it one day the Japanese will 
not want to do it [0.2] yeah [0.3] i don't want to do it [0.2] you don't want 
to do it [0.4] why do you imagine somebody else will want to do it [0.9] these 
are not jobs which are really that grand [1.6] we here will probably make 
movies and [0.5] educational services and you know [0.5] will make dances 
[laughter] [1.1] 
sf1109: can't you perhaps i mean i-, industrialized [0.2] countries will be 
building [0.4] or focusing on different things [0.3] you know [0.5] it would be 
different things that will 
nm1108: well [0.7] advanced industrial countries are [0.4] very much stressing 
economies are very much stressing [0.5] that [0.4] economic growth in places 
like Malaysia chain-, China and so on [0.3] is so-called intensive economic 
growth [0.2] where you 
add capacity and thus you grow [1.2] but the in advanced industrial countries 
[0.2] the ideal is actually to add nothing but to improve the efficiency of [0.
6] what you already have [0.4] intensive [0.9] economic growth [1.1] 
so extensive [0.6] intensive growth [0.4] and economists since long time ago 
and i'm quoting them in this book like Kuznets [1.3] visualized [0.2] you know 
many years ago [0.8] but that was science fiction back then [0.4] that you 
could actually have very rapid economic growth without really any addition to 
your capital stock [0.9] what you would be adding [0.3] obviously would be 
wires and [0.3] you know [0.2] pieces of gadgetry and you know things like this 
[0.3] electronic [0.2] components [0.4] er [0.3] and that all of a sudden [0.6] 
is actually driving the e-, American economy today [0.2] you don't need more 
buildings in New York or more bridges [0.3] you can use all of that [0.2] with 
very little bit that you add in terms of physical equipment [1.3] and make it 
so much more productive [0.3] you know with information technology and so on [0.
4] so [0.3] many of these propositions that they 
started with ten years ago [0.2] when the internet was not around and so on [0.
2] sound [1.0] a bit more plausible [0.4] and a bit more boring because you 
know way then people say hey you're crazy [0.2] now they're saying okay why are 
you boring us with something which is [0.4] probably going to happen [0.3] 
because it's not real science fiction [0.8] so remember [0.2] er i had that 
kind of situation with er i don't know stories about China [0.8] er before 
ninety-three [0.3] when most of the world's realized that China existed and was 
extremely important [0.5] when i would speak to [0.3] you know many of you here 
from the M-S-C programme [0.3] are actually [0.2] professional people who know 
what construction is [0.5] er [0.3] you know i would talk to professionals in 
construction and they would look at me and they would say [1.0] where did you 
get this thing about China [0.2] er what are you reading that we are not 
reading [1.2] now business people very often in my experience behave like [0.2] 
idiots you know [0.2] before they understand [0.5] before it is written in Time 
[0.2] and Newsweek [0.2] and places 
like this that something is true [0.2] it's not true [0.3] and they don't want 
to even listen [0.6] but then [0.2] once they learn it and they learned it in 
March nineteen-ninety-three [0.5] after March nineteen-ninety-three they say 
okay okay what else is new [0.6] so there is an enormous kind of shift [0.4] in 
public opinion [0.4] in especially in the business circles [0.4] and business 
people are very given to fashion [0.6] okay [0.4] so [0.5] you know for example 
starting to say today that Africa one day will be a great construction market 
people will say ergh you know [0.3] you must be crazy [1.5] and obviously if we 
deal to some extent with civil war there and so on [0.3] Africa may become a 
wonderful market for Europeans [0.8] Africa and Europe have always been 
extremely close since er Greek and Roman times [0.8] and there is no reason why 
Africa should be a separate continent in that sense that we [0.2] see it like 
some place far away where people are black not like us over there [0.4] yeah [0.
2] exactly the same people we can make kids together [0.2] so why we shouldn't 
[0.4] do 
other things together [1.5] er [0.6] so in that sense you know i would say that 
there is very great closedness of mind [0.3] in many er professional circles 
about these kinds of questions [0.2] of where these things are likely to be in 
twenty-five years [0.4] now obviously [0.2] you know business people will tell 
you [0.3] if your story doesn't affect me on Monday [0.7] it's not very 
interesting because it talks about some kind of long term future [0.5] 
obviously that's a correct point [1.0] but er it is as i said to you the first 
time we met it is important for a reflective [0.4] practitioner [0.4] to have 
some notion [0.5] where we came from [0.2] with the construction industry [0.9] 
in our different countries in the world [0.3] and where that is likely to go 
over so many years [0.2] yeah [0.2] it is important to have some notion of how 
that [0.3] works [0.3] and that is what i am trying to [0.2] do [0.3] by one [0.
3] bringing you this particular paper that brings the concepts [0.2] having to 
do with my notion of the future of international construction together [0.3] 
and two [0.2] the survey [0.2] which we will 
discuss next time yes 
sm1110: how does this er [0.3] contrast sort of pr-, practice towards er 
globalization in construction and [0.5] er [0.2] to larger companies looking to 
[0.2] move into [0.2] foreign markets and increase their margins and 
opportunites [0.5] but if you're suggesting that [0.3] construction see to move 
away from that [1.2] 
nm1108: i would say very large proportion of firms will not you know th-, th-, 
they er a construction firm of s-, say medium size [0.5] needs a funny jolt [0.
3] to start being interested in [0.2] Belgium even though Belgium is just 
across [0.3] the Channel [1.0] er the jolt would be for example [0.3] that the 
old guy who started the firm in nineteen-fifty-eight [0.8] is passing [0.9] the 
er baton to his son or daughter who is now [0.4] becoming the C-E-O of this 
organization [0.5] and this youngster [0.2] happens to have learned French [0.
6] which [0.4] the father [0.2] will never even dream learning [1.1] it's a fr-,
ene-, you know enemy's language [1.3] so all of a sudden [0.2] young people 
are perfectly open to the notion of going 
to work in Germany [0.5] and that kind of person will [0.2] produce a job that 
people would say [0.3] well [0.2] what the heck is wrong with us why cannot we 
take this particular job [0.2] you know [0.5] er in in a different country [0.
9] if you have a couple of friends there [0.2] you have some kind of 
understanding to the company [0.3] that can help you understand the rules the 
law and so on [0.4] you can [0.2] obviously build things in Belgium as well [0.
6] so er [0.2] small firms especially are quite [0.4] set in their ways [0.3] 
they're in Essex and that's it [0.9] now when a firm becomes dead [0.6] you 
know people start thinking about large projects which are abroad [0.9] but 
generally speaking i again find er like with any fashion you know one year 
black is in fashion the other it's like blue whatever [0.7] er [0.5] these 
fashions shift quite interestingly from year to year my survey's very much 
about fashion [0.5] it is not about [0.3] what really will happen in the future 
[0.3] but how fashions change [0.4] so for example [0.7] there was a period [0.
2] when [0.6] Russia [0.5] er [0.3] and you know Eastern Europe was extremely 
popular [1.2] then 
there was a period when they kind of vanished from the picture because there 
was too much crime there [0.2] anybody who went there [0.3] experienced so much 
trouble [0.4] that they didn't want to stay [0.3] er i mean only Turks and 
Yugoslavs stayed [1.0] because they would er they would know how to pull out a 
pistol if [0.3] the Russian guy pulls out a pistol [0.8] [laughter] and it's as 
simple as that you know [0.2] you protect your perimeter and you say don't come 
in because we'll shoot you [0.2] you know [0.5] [laughter] and the Russians 
understand that perfectly so there is you know the two crews understand each 
other and that's it [0.6] everybody else moved out [1.1] [laughter] but now 
Swedes are buying [0.5] Finns [0.2] to go [0.3] to Russia [1.2] and when you 
talk to Finns [0.2] they all just think about Eastern Europe you you ask them 
about other markets [0.2] yeah [0.2] you know [0.2] we just love Russia [1.9] 
but they're acting as how to say [0.3] not exactly champions but they're really 
working for Swedes [1.7] so Skanska will buy one company another third [0.8] 
organizations with 
expertise where people speak Russian [0.8] don't mind being with Russians [0.5] 
which is important and sometimes quite difficult [0.9] [laughter] you know you 
for example have to [0.2] drink like a fish [1.8] [laughter] if you have a 
glass like this of vodka you know i can tell you [0.2] er [0.2] you are out [0.
9] [laughter] you may think that you drink a lot of beer but beer is nothing 
that's like water but you know when you have a glass like this of vodka you are 
out [0.9] [laughter] and Russians are not [0.2] it's fine [0.7] [laughter] they 
can drink five [0.2] you know [0.2] they can all collapse behind the table [0.
3] but tomorrow they are at work [1.8] [laughter] and if you don't have a habit 
like this Swedes are nice people [0.3] Finns are a bit tougher [0.2] yeah so [0.
5] they have the experience and they're now being sell-, er sold [0.6] to 
various kinds of Russian projects and [0.4] you know there is a certain [0.3] 
orientation [0.5] that particular part of the world is recognized as important 
so Finns are not looking toward Belgium at 
all they couldn't care less [0.9] so that's interesting you know how [0.3] 
people train their vision in some direction [0.5] the British construction 
companies have [0.4] because of the British Commonwealth [0.2] and because of 
the British Empire [0.3] an interest [0.3] in [1.2] for example South East Asia 
[1.2] you know a Briton is not going to feel very uneasy in Kuala Lumpur [0.7] 
like wh-, [0.4] where am i [0.5] you know how do you eat this [0.4] they've 
been there [1.1] so there is no problem [1.5] in that sense that's an enormous 
advantage [1.4] every country has these kinds of [1.3] you know [0.6] blinkers 
[0.7] so Portugal will be looking toward Brazil [0.5] or Mozambique [0.7] but 
Ghana [0.2] mm they don't know about Ghana [1.5] the Finns will be looking 
toward Poland and [0.5] Russia [1.1] the Germans will be looking that way as 
well and correctly because huge markets are going to be there [0.3] once we 
deal with [0.3] organized crime that goes all the way to Putin [0.5] you know 
or or er [0.5] Yeltsin there is no question [0.4] but that organized crime goes 
all the way to [0.4] the top of society [1.7] how do you deal with it [0.6] 
most of us are 
not used to you know for example if [0.5] you know y-, some of you may er er 
feel easier than others [0.3] paying somebody two-hundred dollars to [0.2] take 
your mother into hospital [0.6] i cannot do that [0.5] i'm not used to that [2.
0] but it's still a bit different [0.3] to say [0.2] okay you know [0.4] two-
million dollars [0.4] let's build this dam for you [0.5] their minister [1.8] 
that's a bit more difficult who is going to do that kind of stuff many people 
don't know it in a-, in America that's so illegal [0.3] that business schools 
have a huge problem [0.5] how do you have an American organization some place 
in Pakistan [0.5] how do you deal with that situation [0.9] and it's normal in 
Pakistan to deal that way [1.4] so either you exclude yourself completely from 
that world [0.3] or [0.2] you learn to do it even though it's not exactly 
something that you like doing [0.4] because 
it's a bit [0.2] unusual [0.2] you know [0.6] it's not something that you read 
in books [1.8] so there are many questions of that sort which are quite 
interesting [0.5] and er one of the things that i like to do with my survey is 
to look at [0.7] for example [0.2] Japanese opinion about their part of the 
world i don't publish these things because it becomes too desegregated this 
kind of information [0.4] but i'm interested in these questions [0.3] how do [0.
2] Indians look at this if i have a couple of Indians in my survey [0.5] or how 
do the Britons look at things vis-, vis-à-vis Germans [0.4] and everybody has 
different blinkers and they're quite interesting [0.7] British blink-, blinkers 
[0.4] and that's good for us and that's reflected here are quite wide because 
of the British Commonwealth [0.9] but many Britons don't look toward Germany 
Germany doesn't exist you look [0.3] past Germany [0.7] yeah [0.5] younger 
people are different [1.2] anyway that's the broad answer to your [0.7] 
question [0.5] now let 
me see how are we doing [0.5] er i would like to [0.2] er now shift gears and 
to introduce you to the [0.4] methodology or technique [0.3] that i will be 
using [0.6] in [0.2] er [0.3] most of my papers that i will be showing you [0.
4] er these [0.9] three types we meet [2.1] er the methodology comes from 
something that is known as input-output analysis [0.7] er that particular term 
exists in many fields but in economics it has a very specific meaning [0.9] 
input-output models [0.7] were invented by a Russian fellow [0.2] whose name is 
[0.4] Wassily Leontief [1.4] who published in nineteen-thirty-six an important 
paper while he was a professor at Harvard [2.0] and he remained professor at 
Harvard er througho-, throughout most of his life [1.3] and for that paper [0.
2] Leontief got [0.4] in nineteen-seventy-three [1.4] quarter of a century ago 
[0.3] got his Nobel prize [0.5] in other words [0.2] it is a bit of work [0.4] 
that is quite important in analysis of national economies [1.1] is now based on 
reasonably good data [0.3] and one can compare different countries with this 
kind of data so that's what i am doing [0.2] er [0.5] this book is [0.9] 
almost all [0.5] almost hundred per cent about [0.4] input-output analysis [0.
5] many parts [1.0] are kind of hairy and mathematical and i would tell you not 
to touch them so for example part one [0.3] contains four papers [0.2] that you 
should avoid [0.2] if you want to preserve your eyesight [0.3] er [2.6] 
[laughter] er if you like er matrix algebra enjoy but er more likely than not 
you will find it appalling [1.2] er and that's okay [0.4] er i don't want you 
to [0.2] learn matrix algebra i want you to learn [0.3] the basic logic of 
input-output analysis so that's what i'm trying to do [0.9] now the paper from 
which [0.7] i think you should learn about this is this one [0.6] it's called 
Direct and Indirect Resource Utilization by the Construction Sector [1.3] in 
the U-S [1.6] now [0.3] you have all these some key words in this long and 
boring title [2.9] one of the reasons why i'm using input-output ana-, analysis 
is that [1.1] if you go to a construction site [0.4] and you ask a question [0.
4] what is passing [0.2] through the gate [1.4] er you will learn that er [0.7] 
cement is passing through in 
trucks [0.4] which either or don't [0.6] you will learn that er rebars are 
going through you will learn that steel beams are passing through [0.2] 
labourers [0.3] you will see cement you will see [0.2] er [0.7] various bits 
and pieces of buildings bricks and so on [1.5] and if you sat at the gate [0.3] 
from [0.5] day zero [0.3] to the last day of construction [0.4] you will get a 
pretty good picture [0.2] of what was used in the building [0.4] if you at the 
same time look at the plans [0.2] financial [0.9] deals made with the company 
that build this [0.6] er i don't know loans they got [0.4] er various kinds of 
professional advice about [0.2] foundations and God knows what [0.4] you will 
get a pretty good picture of [0.3] direct inputs into the construction process 
[0.3] these are called direct inputs [0.2] that is going into the site [0.4] 
either [0.4] literally directly [0.2] or [0.2] via the construction company in 
the form of plans and you know things of that sort [1.0] today [0.3] much of 
the plans and [0.9] er [1.0] intangible things [0.2] would be coming via a wire 
into a computer [0.3] on the site [0.3] so you could even measure that [0.5] 
you 
can have a little meter [0.3] to tell you [0.4] what went in [0.3] and you 
could also learn [0.2] how much that cost [0.7] [cough] [2.1] direct inputs are 
a very small part of what actually happens when you build something [1.1] er [0.
3] let me give you a hypothetical example [0.3] let's imagine [0.3] that you 
don't have a small project because it's a bit difficult to stretch your mind 
like this [0.2] but you have a very large project you are building a university 
[1.7] new university someplace in the United Kingdom for example [1.2] well 
there's a lot of concrete there many new things that you will have to bring to 
that particular location [0.7] so you can imagine [0.3] if there is such an 
increase [0.9] of input [0.2] at a particular location that somebody will build 
a [0.4] warehouse relatively close to the site [0.7] in which [0.5] various 
things will be stored before they go to the site [0.5] there will be someplace 
close to the site a small plant [0.3] making prefab-, b-, prefabricated beams 
[0.6] that are required in construction [1.6] et cetera [0.9] these would be 
secondary [0.8] inputs they come [0.9] off-site [0.9] are worked in some 
fashion you use cement and rebars and all that you make the beams and then you 
ship them [0.4] to the site itself it's not done on the site because [0.2] the 
site is for example not big enough [0.2] to have [0.2] a plant that makes 
rebars or beams or whatever [0.9] but then [0.7] you can understand that these 
rebars come from some [0.5] foundry [0.2] which makes various products they 
make shovels as well [0.9] so [0.3] that's one step back that's a third step 
back [1.2] but then [0.2] if you [0.2] take a chain like this you will realize 
that someplace along this thing [0.2] somebody had to buy a new truck because 
they didn't have enough trucks [0.2] to build [0.3] this particular thing so 
the car industry's affect [1.6] the car industry [0.3] if a number of cars [0.
2] are required [0.2] would all of a sudden say well we need new [0.6] i don't 
know metal-bending machinery [0.2] to produce more cars for this particular 
project [0.5] and all these are actually inputs into the construction process 
but they are just [0.2] further and further back [0.3] a very long chain [0.8] 
well [0.2] input-output analysis is about [1.2] direct 
but also all the indirect [0.2] effects of a particular purchase [1.4] so we 
would say [0.2] if you increase [0.5] demand for construction by one pound [1.
7] by how many P will all other industries benefit [0.6] and i can tell you [0.
6] all other industries will benefit [1.9] only in the very primitive economy 
some industries wouldn't benefit [0.3] for example fishing will [1.1] be left 
out [0.5] because people don't like fish in that country [0.3] but if people 
like fish [0.6] more labourers means more fish for lunches et cetera et cetera 
[2.0] so [0.7] almost everybody's affected by any change even by just one pound 
[0.4] but it's difficult to conceptualize [0.7] in economic analysis these 
things are [0.2] known as multipliers [0.3] so you say [0.3] one pound spent on 
construction [0.4] multiplies into something like [0.3] two pounds spent on 
everything [0.3] including construction but that everything else that you 
require [0.2] in order to [0.3] have [0.2] construction services [0.3] and [0.
4] er [1.0] ultimately a building [1.4] so [0.6] input-output analysis is based 
on [0.8] input-output [0.2] tables [0.2] and an input-output table looks like 
this [2.8] 
it has [2.5] by column [0.5] a number of industries [1.1] or industrial sectors 
[0.3] and it has by row [0.2] a number of these sectors [0.6] we would look at 
each sector like this we will say [0.3] sector one [1.0] say construction [0.7] 
produces a certain amount of stuff [1.3] by using inputs from all the other 
sectors including itself because construction may be building that shed [0.9] 
in which [0.2] there will be some materials and equipment [0.3] for the 
building itself [0.8] okay [0.3] or secondary structures or things like this [0.
4] so construction produces a certain amount of thi-, er er certain amount of 
stuff [0.3] which is [0.2] here in this particular box [0.9] it will be [1.0] 
appearing in this box as output of the construction sector [0.3] but a portion 
of that output goes to intermediate use [0.3] and a portion goes to [0.2] final 
use [0.7] in the case of construction actually [0.5] very little goes to [0.4] 
intermediate use it is only maintenance and repair [0.5] that goes to different 
sectors [0.6] everything [0.6] that construction produces is considered to be a 
capital [0.4] or [0.2] investment good [0.9] which is 
produced whole [0.2] to be used by other sectors [0.2] in the next round [0.2] 
the of economic production in other words [0.2] you do not use up a building as 
you produce something [0.5] you [0.3] perhaps [0.2] depreciate it [1.0] so a 
building like this [0.5] is not used like cement is used [0.2] you have a bunch 
of cement and a bunch of sand [0.4] and water and then you mix them [0.6] and 
then [0.2] cement is kind of lost in concrete [0.7] well a building is not lost 
because you set here [0.3] it is perhaps used a bit more [0.3] so [0.2] we will 
have to paint it a bit [0.6] sooner [0.5] 
okay [0.3] so remember [0.3] all construction goods are final goods [0.7] 
except maintenance and repair services [1.5] so final goods are then used as 
capital goods to produce something else with them [2.1] but [0.5] something 
like sand [0.6] is used by various sectors for various reasons glass 
manufacturing uses it [0.2] in order to make glass [0.2] we use it to make 
concrete et cetera et cetera [1.2] so [0.3] if we look at any one sector [0.3] 
we will see [0.2] by row [0.6] the output of that sector and we will see where 
pieces of it are would actually go [0.2] in the production [0.9] or 
in the industrial scheme in which everybody uses a little bit of something to 
make something else [1.1] if you are making a car you need a little bit of 
steel you need a little bit of this and that [0.4] and then you [0.4] put all 
of that into a car [0.3] you assemble [0.9] construction is an assembly 
industry [0.4] and if you look into all the inputs into construction so this is 
output [0.3] these are all the inputs into construction [0.3] you will see 
which sectors [0.2] the construction sector buys from [0.6] it buys from 
agriculture [0.2] for example [0.2] materials for roofing [0.4] er in Sri Lanka 
palm trees or whatever [0.6] that is purchased directly from [0.3] agriculture 
[0.4] in this country obviously [0.3] fewer such things are purchased directly 
from agriculture [0.6] but they are purchased from various materials producers 
[1.4] which purchase [0.4] the basic materials [0.2] from those who made them 
[0.3] say steel [0.9] say plastic materials in bulk [0.6] then you shape all of 
that into something like this and you sell it [0.3] to [0.2] the construction 
sector [0.3] to store in a building [0.8] so 
if you look in a particular column [0.4] you will find [0.2] where the 
construction sector buys its products [1.4] this way you will say you will see 
where it sells its products in this particular case [0.2] maintenance and 
repair services [0.7] but by looking [0.3] at the column you will also see [0.
4] the value added component [0.7] of so-called primary inputs [0.7] primarily 
labour [1.4] but also many other things [0.8] capital [0.6] for example [0.8] 
also land [0.3] because this construction company will need land for [0.2] its 
equipment and things like this [0.9] so [0.4] primary inputs include a number 
of different things [0.3] but primarily [0.2] labour [0.6] so if you look at 
the column [0.2] that corresponds to the construction sector [0.3] you will see 
[0.2] total input down here [0.7] then you will see various amounts of primary 
inputs [0.2] primarily labour [0.4] you will see all the other industrial 
inputs that come from other industries [0.6] and that would form the global 
input [1.1] so [0.4] a table like this [0.5] is divided into a number of 
quadrants [0.3] the first quadrant [0.5] shows intersectoral demand [0.4] how 
different industries buy from 
each other [1.8] quadrant two shows buying on demand [0.7] which is [0.6] er [0.
2] going by row for each sector [0.2] or each industry [0.4] but by column it 
would each would include [0.3] consumption [1.1] it would include investment [0.
5] it would include government expenditures government would be buying i don't 
know [0.3] er a building to put a tank in [1.7] or they would buying a [0.2] 
building to put some kind of [0.3] water resou-, resources [0.2] unit [0.3] 
which is a part of governmental [0.4] er [0.7] organization [1.3] and [0.2] it 
would also include exports [0.2] exports of [0.2] construction [0.2] services 
in this case [0.3] not construction goods [0.4] this building [0.7] or any 
other bulding can never be exported [0.3] it is here [0.2] and that's it [1.2] 
if a building is demountable [0.8] the thing that is transported according to 
national economic accounts is materials [1.6] the act of tying the building to 
a particular plot of land is construction [2.2] okay [1.8] now [0.2] in this 
sector here quadrant tree [0.2] three you have value added [0.7] value added [0.
3] there are various primary inputs [0.2] that go into a production of anything 
[0.5] it will be [0.5] 
labour [0.4] capital [0.4] land [0.9] but also imports [0.6] products coming 
from other countries [1.1] so we have exports going out and imports coming in 
[1.7] finally quadrant four [0.2] includes something that is called [0.4] 
direct [0.2] factor purchases [0.3] for example [0.4] when government employees 
are paid for their work [0.5] in the tax office [0.3] these are [0.2] direct [0.
4] purchases of their labour services [0.2] by the government [0.5] they're not 
a part of the [0.2] industrial companies [1.8] a table like this has many 
features first of all it is square [1.3] it is square [0.2] it has an equal 
number [0.8] of columns as rows [0.2] N [0.2] for [0.3] intersectoral demand [0.
2] and M for final use but also M [0.2] for primary inputs [0.6] so each input-
output table is square [1.4] second [1.3] each term down here for example [0.5] 
total input of one particular industry [0.2] must be equal to total output of 
that industry [0.2] because profits are included [1.1] so total output is for 
example this building there's the total output of a firm in one year [2.0] 
let's imagine that the construction firm [0.3] built it from January first [0.
5] to December thirty-first [0.3] 
of nineteen-seventy-six when this was built [1.2] that firm [0.7] would give 
this building to the university it would be say one-million [1.5] the firm will 
have paid various [0.8] suppliers of materials and services say [0.2] nine-
hundred-thousand and kept [1.2] hundred-thousand [0.8] that profit is accounted 
in the picture [0.3] because their profit is [0.3] renumeration for what the 
company did [1.8] so output [0.5] must always be equal to input [0.7] and when 
i add all of this up [0.5] this sum [0.2] must be equal to this sum [0.5] this 
sum must be equal to this sum [0.4] [cough] [1.5] so [0.2] an input-output 
table is squared [0.3] and it's also squared away [0.2] it is made consistent 
[1.0] now [0.2] you can imagine when national income accounts are collected [0.
3] when numbers are collected by statistical office [0.5] these figures and 
these figures don't tally up [1.3] there are all kinds of mistakes [0.3] in 
statistical [0.2] procedures like this [0.7] and an input-output table is 
squared away by various mathematical tricks [0.3] you say for example [0.6] i 
believe more [0.9] in say input figures [0.5] in Italy [0.3] than in output 
figures [0.5] 
because everybody is cheating in construction [0.9] not only in Italy [0.3] but 
they're a bit more than in other European countries [0.6] yeah [0.4] so [0.2] 
if you are building something [0.6] you get paid in cash [0.2] do you report 
the cash of course not [1.1] many Italian builders especially small builders 
would never [0.2] look at [0.6] the a cheque [0.7] they're not interested [2.9] 
if you are paid only in cash [0.2] you will clearly report something to the 
government because it would be suspiscious that you actually lost money all 
year long [0.7] so you report something but you report [0.3] just enough [0.2] 
so that you are not suspiscious by comparison with another builder [1.0] he 
reported twelve [0.2] per cent so you report [0.5] twelve-and-a-half because 
you're a nice guy [2.2] [laughter] but [0.2] if you look at inputs of the 
construction industry you see an enormous amount of paint and [0.6] bricks and 
everything you know much much more than output [0.3] so [0.6] then you adjust 
[1.5] output [0.3] by the input figures [0.4] yeah [0.5] and these are 
statistical procedures which are not necessarily 
easy [2.2] now another table which relates to this whole story [2.4] it is the 
same thing [0.5] but [0.2] now they're broken up [0.4] this is the the 
interindustry point this is quadrant one [1.4] quadrant one [0.7] and it says 
[0.3] sector I [0.7] produces some kind of [0.5] output [0.4] which is called X-
sub-I [0.5] which stands for output of sector I [0.9] here is a sector J [0.5] 
and here is the [0.2] total input into sector [0.2] J [0.3] which is called X-
sub-J [2.9] here is a flow [0.4] and that's expressed actually in pounds or yen 
or dollars [0.5] between I and J sectors [0.4] and it's called [0.2] X-sub-I-J 
[0.6] X-sub-I-J [0.2] that's the flow between two sectors expressed in value 
nm1108: 
says sector I [1.2] sells many things to other sectors [0.2] sector J means any 
receiving sector [0.7] when you add it up [0.2] that's the total [0.3] it sells 
to final demand [1.5] and the total output is equal to that [0.3] now [0.4] 
going back to Leontief [0.2] the basic thing that Leontief said [0.4] which was 
a revelation in nineteen-thirty-six [0.3] is that [0.2] every sector produces 
not only for final demand [0.7] but also for other industrial sectors [0.3] so 
a large portion of what 
you produce is not visible [1.2] the best example is if you have a [0.2] pump 
[1.4] going down into the earth [0.9] going to the aquifer [1.1] where water is 
[1.1] and you start doing this [0.5] and all of a sudden water starts coming up 
[0.2] and you want one glass of water [0.7] you got one glass but the whole 
pipe is full [1.7] for you to get one car [0.5] millions of cars must be on the 
line for that car to come out [0.9] so an enormous amount of stuff is always 
elsewhere being produced [0.4] being mixed in some fashion [0.4] we make 
something we sell it to these guys [0.4] they do something to it [0.3] add 
something to it [0.3] and then [0.2] they sell it to another guy [0.3] and [0.
2] something travels through the national economy for a long time before it 
finally becomes a car [1.1] just think about you know [0.2] dashboard [0.3] how 
many things go into a dashboard [0.4] and there are special manufacturers that 
make dashboards [0.3] but that are made from thousands of pieces that come from 
someplace [0.4] yeah [0.6] until they finally come to Mazda [0.4] and [0.2] the 
whole thing is slotted into [0.3] a chassis [2.3] so we can also say 
that input [1.0] is like this this is all intermediate inputs [0.7] X-sub-dot-J 
simply means that you are summing all of this up [0.6] but also what you are 
putting in there is value added [0.8] primarily labour but here it's sum [0.2] 
into one term [0.3] V-sub-J [1.2] and then the total input into an industry's 
called X-sub-J so it says [1.3] we in making anything buy a lot from other 
industries [0.2] but we also buy [0.5] value added [0.3] we contribute to 
national income by doing that by the way [1.6] every time you hire any primary 
input like labour [0.8] you pay wages and salaries [1.1] for capital you pay 
interest [0.8] for land you pay rents [0.2] these are sources of income [0.4] 
so when you add all of this up [0.9] this by the way [1.4] when you add all 
this up is contribution of this sector to national income [0.8] and this is 
contribution of this sector to [0.5] G-N-P [0.9] to output [0.3] gross [1.2] 
national product [1.8] and this is what this says [0.2] it says when i add all 
of this up [0.2] it will be called V [0.4] it will be national income [0.3] 
that must be equal to adding all of this up [0.5] which is called [0.9] 
gross national product or total output [1.7] so these are the kinds of things 
that are [0.2] there [0.3] now i don't want to er [0.2] drag you through all of 
this [0.4] right now [0.2] i'll do it some other time it'll be fun [0.7] 
[laughter] er [0.7] i'm showing you that all of these terms [0.5] you know have 
names [1.7] we'll talk about some of these things [0.3] but then [0.2] i can 
start combining these things i can start forming ratios [0.9] which are 
interesting to study which look like this [0.4] i can take one term for example 
X-sub-I-dot [0.2] divided by Y- [0.2] sub-I [0.3] and [0.2] i call that 
intermediate output to final demand ratio for sector I [0.2] and i can then 
plot these things [0.3] and understand what's happening [0.3] with a particular 
[0.3] sector [0.6] anyway [0.4] i'm not going to do that now i'll do it some 
other time [1.4] but please look into this because it's boring to talk about it 
[0.2] see it's much better for you to read it [0.2] and for me to refer to it 
[0.4] easier on me easier on you [2.3] now i'd like to er focus your attention 
briefly [0.6] on [0.2] this [0.5] series of appendices there are two appendices 
here [0.3] and i would like you to read them [0.7] er it was supposed to be 
read for today but i would still like to [0.8] point out that this is something 
that i consider important [1.5] this is written in so-called matrix notation [1.
5] some of you had some matrix algebra many of you had none [0.6] but a matrix 
is basically a table of numbers [0.5] so [0.2] a matrix of the kind that you 
will see in a second [0.2] which has four numbers [0.3] has two rows and two 
columns [0.4] that [0.2] thing we call a matrix can be operated on [0.3] just 
like you can operate on any standard number [0.3] which in mathematics is 
called a scalar [0.6] a scalar is just a number [0.4] you can add numbers and 
so on [0.6] in matrix algebra you can add matrices [0.2] you can [0.2] divide 
them [0.3] sort of [0.5] you can subtract them you can multiply matrices you 
can operate on them [0.4] in other words you can operate on tables that look 
like input-output tables [0.5] so you can have a table that has [0.2] five-
thousand rows [0.3] and five-thousand columns but you just write [0.2] A [0.5] 
which means [0.4] technical coefficient matrix in this case [0.2] so 
it's wonderfully [0.7] easy [0.4] to manipulate things [0.2] and not drag five-
thousand things by five-thousand things around [0.2] yeah [1.0] now [0.8] this 
is what this says and i'm not going to talk about the second equation but just 
the first one [0.2] it basically says that's the basic set of equations [0.3] 
that Leontief set up [0.3] he said [0.7] output [1.1] is equal to intermediate 
output [0.8] and final demand [1.3] every [0.7] economy [0.2] must produce to 
satisfy final demand [0.2] must produce many other things [0.9] if you dear [0.
3] folks want [1.0] three cars [0.2] we'll have to make fifty [1.7] for the 
production process to be possible [0.2] for you to get three cars [1.1] or if 
you want three-million [0.2] well we'll have to make five-million [1.2] and 
they will be in process [0.3] moving toward you [0.6] obviously if you don't 
want them any more we have a big problem [0.2] because there are many things in 
the pipeline [2.4] now [0.2] this is called an output vector [0.2] and you will 
see how it looks but it's basically [0.4] in [0.2] my simple example just two 
numbers one on on top of the other [0.5] this matrix says well [0.2] technology 
matrix [0.3] and i'll explain to you [0.2] er when we meet again [0.2] or when 
we start talking about things [0.6] er in a bit more detail how that matrix is 
constructed [0.7] this is as you can see exactly the same vector again [1.1] 
and this is the [0.3] vector of final [0.2] demand [0.4] i'll just show you [0.
3] er how that looks in actual numbers [0.3] to give you a feeling of er how 
this topic will look [0.7] i have a very simple system [2.2] in which i have 
some matrix which i have not introduced yet called Z [0.4] which simply says or 
Z in English [0.3] English [0.9] er [0.9] these are all the flows [0.2] between 
different [0.4] sectors of the national economy [0.4] this is for example flow 
from industry [0.4] two [0.2] to industry [0.2] one [0.5] and it's [0.3] in 
pounds let's say [1.4] so this is how it looks [1.2] this is final demand [0.7] 
in pounds again it says [0.4] people want [0.4] for one year [0.2] six-hundred 
[0.2] say billion [0.5] worth of construction goods [0.8] and they want [0.2] 
say [0.5] fifteen- [0.7] hundred- [0.3] billion [2.2] worth of [0.2] non-
construction goods [2.3] so that's what that would say [0.5] this also this is 
a [0.2] vector V which [0.2] is horizontal which says [0.9] we have for 
purposes of production [0.4] six-hundred-fifty-billion [1.5] worth of money to 
spend on income of people who will be contributing primary inputs to 
construction [0.9] primary inputs mainly labour [0.8] and this is [0.3] one-
thousand-four-hundred- [1.1] billion pounds worth of primary inputs for [0.2] 
all the other [0.7] sectors of the national economy [2.0] so er [0.3] X is in 
this particular case output [1.0] and [0.4] you know output happens to look 
like this [0.2] now [0.2] matrix A [0.2] as you can see from this is this 
matrix transformed in a particular way [0.4] you first add these two numbers [0.
3] and call that X-sub-one [0.3] that's total input [0.5] and then you [0.2] 
divide that into this and into that [0.5] sounds complicated but basically [0.
2] this simply becomes a proportion [0.3] you say out of one pound [0.9] of 
total inputs [0.6] twenty-five P [0.6] come from here [0.4] and the rest that's 
seventy-five P come from there that's basically all [0.4] it's the simply [0.2] 
coefficients that tell you [0.3] out of one pound [0.2] or out of hundred per 
cent [0.2] how much comes from a particular place [1.4] so [0.2] that matrix 
which is [0.2] what i just 
explained that means fifteen P this means twenty P [1.1] this tells you [0.6] 
how [0.3] things are actually mixed in terms of some kind of basic [0.5] not 
technology really [0.2] but [0.2] basic recipe [0.3] you know [0.2] out of [0.
2] one kilo [0.2] how much is in eggs [0.2] and how much is in flour [2.8] then 
you do a few more operations which i will not drag you through right now [0.5] 
and why this is so et cetera et cetera then you come up with this thingy [0.9] 
this is a matrix it has [0.5] two [0.3] rows and two columns [0.6] but this 
matrix which we have computed in some mirculous way [0.6] tells us very 
interesting things [0.5] for example [0.7] this number here [0.3] tells us [0.
4] something [0.2] miraculous [0.2] it says [0.7] if you increase [2.3] final 
demand [0.2] for non-construction goods in this economy [0.7] by one pound [1.
0] or one-zillion pounds doesn't make any difference but you know one pound [2.
1] the [0.4] final demand wh-, sorry the total output of construction industry 
will go up by [0.3] point-twenty-six [0.2] and so on [0.2] in other words [0.2] 
twenty-six P [1.2] so even though you didn't want any more new construction [0.
5] by wanting more 
non-construction goods [0.2] construction goods will be required [0.3] because 
[0.2] these guys that make different things [0.2] will have to be selling to 
each other and they will have to be building new plants and things like this 
and that would involve construction [0.2] so even if you don't want any 
construction goods [0.2] you will get them [0.3] because construction goods are 
involved in production of other goods [0.8] yeah [0.6] but this is the literal 
meaning of this [0.7] if you increase final demand [0.3] of good two [1.1] by 
one pound [1.1] the output [0.4] of good one in this economy will go up by [0.
2] twenty-six P [0.2] even though you don't want it [0.2] but this is what will 
happen because things are mixed in that way [0.5] so this is [1.0] in economic 
parlance [0.2] the sensitivity of output of one industry [0.2] to changes in 
final demand [1.4] of another industry [1.5] yeah [0.5] that's what input-
output is about so that table [0.2] is an interesting table it tells us 
something interesting about [0.2] how different industries are connected [1.0] 
amen [0.6] finished [laughter]