Social Accounting Matrices

A Social Accounting Matrix (SAM) is a detailed framework that captures all economic transactions within an economy, showing how money flows between households, businesses, government, and other sectors. It functions like a comprehensive financial map, illustrating income and expenditure, production, and income distribution in a single, organized table. SAMs help policymakers and analysts understand the economy’s structure, assess the impact of policies, and identify relationships between different sectors. Think of it as a snapshot that tracks the interconnected financial activities that keep an economy running smoothly.