Economic impact dynamics of complex engineering project scheduling

The sequential interindustry model (SIM) is a dynamic interindustry production model designed for economic impact analysis where interest centers on the chronology as well as the magnitude of the impact. SIM is based on the static Leontief input-output model. The technical coefficients of the latter, describing the relative magnitudes of interindustry input flows, are replaced by time-phased input coefficients containing additional information on the timing of industry inputs with respect to product completion. Coupling engineering project scheduling methods, such as the critical path method (CPM), to SIM allows the investigation of two distinct engineering-economic issues. The first involves the development of the time-phased input coefficients themselves. Industry production schedules can first be determined based on CPM or alternative scheduling practices. These schedules can then be used to derive the time-phased coefficients. This application is of interest to economists interested in incorporating engineering information in the development of input-output models. The second involves computation, via SIM, of the dynamic economic impact of large, complex, and lengthy production, construction, and related macroenginering undertakings. These undertakings are typically scheduled using CPM. The resulting total economic impact chronology is determined by the interaction of payment schedules with the regional and national economies, consisting of industries that are themselves described through time-phased input coefficients. Changes in the payment schedule result in changes in the impact chronology as it ripples through the economy.