Investment in Housing Sector, an Input- Approach



The Housing sector can be considered both the exchange of intermediate goods and the investment goods for the manufacturing sectors. The housing sector is the buyer of intermediate goods such as brick, cement, iron etc from one side, and uses the investment goods such as crane etc from other side. Furthermore, it uses the labour force. Thus, the housing sector has three types of buying which includes intermediate goods, investment goods and labour force.
In addition to the above case, the housing sector is also a supplying sector. From this stand, it produces the intermediate inputs, to the manufacturing sectors. On the other side it produces investment goods, which is bought by other economic sectors. The latter can be named as the investment in housing, which is a considerable amount and can be said that it is equal to the total investment of private sector in the housing. The above discussion can be stated in an input-output framework. To simplify and summarize, the whole economy is divided into two sectors of housing and other sectors. It is obvious that other sectors include, manufacturing sector as well.