Research on non-linear input–output model based on production function theory and a new method to update IO coefficients matrix

A non-linear IO system is presented in this paper, based on the IO theory and production function theory. It is an extension of the famous Leontief’s IO model. The original model is a description of the situation when each sector possesses constant returns to scale characteristics and input factors change by equal proportion. Using the new model, the paper puts forward a new and more flexible adjustment equation of IO coefficients matrix. In addition, an example is given to prove the feasibility and validity of the non-linear IO model.