## Monday, 21 November 2011

### How to calculate Leontief matrix in excel

Calculate the Leontief matrix in excel. Leontief matrix is a matrix that is the inverse of identity matrix minus matrix A. Leontief matrix is widely used in making the simulation or quantitative input-output analysis. In mathematical equations used to define the matrix Leontif are:

L = (I - A) -1

where:
L = matrix inverse Leontief
I = Identity Matrix
A = matrix A

By using Microsoft Excel, if we known a matrix A, then the Leontief inverse matrix can be calculated
to be more easily able to see the guidelines below:

1. Create a table matrix A and the identity matrix as below

2. To calculate the matrix I-A
Block range E2:G4
type the formula = A7:C9-A2:C4
Then press the key combination Ctrl + Shift + Enter

3. To calculate the Leontief inverse matrix

Block range E7:G9
type the formula = MINVERSE (E2:G4)
Then press the key combination Ctrl + Shift + Enter

The result looks like below

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