Abstract
In many instances, and for variety of reasons, input–output researchers are compelled to both employ mechanical techniques to update older survey-based tables as well as using more aggregated ones. This combination, however, gives rise to several concerns. The present paper is an attempt to investigate two such questions. First, the effects of aggregation on the accuracy ranking of selected updating methods, and second, the effects of aggregation on intertemporal stability of the input–output coefficients. To probe these issues, three updating methods were selected. These methods are NAÏVE or constant coefficient hypothesis, RAS or biproportional method, and LaGrangian optimization technique. Two survey-based tables from the former Soviet Union along with the selected updating techniques are used to generate updated target year’s direct and inverse transaction matrices at four aggregation levels. Comparison of the resultant estimates at these four levels of aggregation with their counterparts in the actual benchmark table reveals that a higher level of aggregation neither affects the rankings of the updating methods nor does it universally and unequivocally leads to a higher degree of intertemporal stability of input–output coefficients.
Similar content being viewed by others
References
Ara K. (1959), The aggregation problem in I–O analysis. Econometrica 27:257–262
Blair P., Miller R. (1983), Spatial aggregation in multiregional input–output models. Environmental and Planning A 15:187–206
Bulmer-Thomas (1982), Input–Output Analysis in Developing Countries. John Wiley, New York
Butterfield M., Mules T., (1980), A testing routine for evaluating cell by cell accuracy in shortcut regional input–output tables. Journal of Regional Science, 20, 293–308
Cabrer B., Contreras D., Miravete E.J. (1991), Aggregation in input–output tables: how to select the best cluster linkage. Economic Systems Research, 3, 99–109
Carter A.P. (1970). Structural Changes in the American Economy. Harvard University Press, Cambridge MA
Chakraborty D., ten Raa T. (1981), The aggregation problem in input–output analysis – a Survey. Artha Vijnana, 23(3–4): 326–344
Comer J., Jackson R.W. (1997), A note on adjusting national input–output data for regional table construction, Journal of Regional Science, 37 (l):145–153
Crown W.H. (1987), An approach to estimating a consistent aggregate input–output Model. Growth and Change, 18 4, 1–9
Crown W.H. (1990), An interregional perspective on aggregation bias and information loss in input–output analysis. Growth and Change 21(1): 11
Dietzenbacher E. (1992), Aggregation in multisector models: using the Perron vector, Economic Systems Research 4(1): 3–24
Doeksen G., Little C. (1968), Effect of size of input–output model on the results of an impact analysis. Agricultural Economic Research 20(4): 134–138
Fei J.C.H. (1956), A fundamental theorem for the aggregation problem of input–output analysis. Econometrica 24:400–412
Fisher W.D. (1958), Criteria for aggregation in input–output analysis, Review of Economics and Statistics 40:250–260
Friedlander D.. (1961), A technique for estimating a contingency table, given the marginal totals and some supplementary data. Journal of Royal Statistical Society Series A.123 (Part 3): 412–420
Gallik, D.M., Guill, G.D., Kostinsky, B.L. and Vladimir, G. (1979), ‘The 1972 Input–Output table and the changing structure of the Soviet Economy in a Time of Change’, in Soviet Economy in a Time of Change, a compendium of papers submitted to the Joint Economic Committee Congress of the United States, Vol. I, Joint Committee Press
Gallik, D.M., Kostinsky, B.L. and Treml, V. (1983), ‘Input Output structure of the Soviet Economy 1972’, Foreign Economic Report Number 18, Washington, DC, U.S. Department of Commerce, Bureau of the Census
Garhart R.E., Giarratani F. (1987), Nonsurvey input–output estimation techniques: evidence on the structure of errors. Journal of Regional Science 27(2):245–253
Gibbons J.C., Wolsky A., Tolley G. (1982), Approximate aggregation and error in input–output models. Resources and Energy 4(3):203–230
Green H.A.J. (1964), Aggregation in Economic Analysis. Princeton University Press, N.J
Harrigan F., McGilvray J., McNicoll I. (1980), Simulating the structure of a regional economy, Environment and Planning A 12: 936–972
Harrison G.W., Manning R. (1987), Best approximate aggregation of input–output systems. Journal of the American Statistical Association, 82(400):1027–1031
Hatanaka M.. (1952), A note on consolidation within a Leontief system, Econometrica, 20(2): 301–303
Hewings G.J.D. (1972), Input–output models: aggregation for regional impact analysis. Growth and Change 3(1):15–19
Howe, E.C. and Johnson, C.R. (1987), Linear Aggregation of Input–Output Models, Department of Economics, University of Saskatchewan
Ijiri Y. (1971), Fundamental queries in aggregation theory, Journal of the American Statistical Association 66:766–782
Israilevich, P.R. (1986), Biproportional Forecasting of Input–Output Tables, Ph.D. dissertation, University of Pennsylvania
Isserman A.M. (1977), The location quotient approach to estimating regional economic impacts. AIP Journal 44:33–41
Jalili, A.R. (1994), An Inquiry Into Non-Survey Techniques for Updating Input–Output Coefficients, Ph.D. dissertation, University of New Hampshire.
Jensen R.C. (1980), The concept of accuracy in regional input–output models, International Regional Science Review 5(2):139–154
Karaska G.J. (1968), Variation of input–output coefficients for different levels of aggregation, Journal of Regional Science, 8(2): 215–227
Kossov, V. (1972), ‘The theory of aggregation in input–output models’, in Carter, A.P. and Brody, A. (eds), Contributions to Input–Output Analysis, Amsterdam, North-Holland
Kostinsky, B.L. (1976), ‘The reconstructed 1966 Soviet Input–Output Table: revised purchasers’ and Producers’ Prices Tables’, Foreign Economic Report number 13, U.S. Department of Commerce, Bureau of Economic Analysis, September
Kymn K.O. (1990), Aggregation in input–output models: a comprehensive review, Economic Systems Research 2 (1): 65–93
Lahr, M.L. and Stevens, B.H. (1987), ‘Sectoral aggregation in regional input–output models, concepts and problems’, Paper presented at the North American Meetings of Regional Science Association, November, Baltimore, Maryland
Lahr M.L., Stevens B.H. (2002). A study of the role of regionalization in the generation of aggregate error in regional input–output models. Journal of Regional Science, 42(3):477–507
Lee K. (1997), Modeling economic growth in the UK: an econometric case for disaggregated sectoral analysis. Economic Modelling 14(3): 369–394
Lee K.C., Pesaran M.H., Pierse R.G. (1990), Testing for aggregation bias in linear models, The Economic Journal, 100 (400):137–150
Leontief W. (1936), Quantitative input and output relations in the economic system of the United States. Review of Economic and Statistics 18:105–125
Leontief W. (1951). The Structure of American Economy 1919–1939.2. IASP publishing Company, New York
Lysko W.M. (1981), Effects of sector aggregation in an input–output table. Business Economics 16(4): 57–59
Madsen B., Jensen-Butler C. (1999), Make and use approach to regional and interregional accounts and models. Economic System Research, 11(3):277–299
Malinvand E. (1954), Aggregation problem in input–output models In: Bama T., (eds). The Structural Interdependence of the Economy. John Wiley and Sons, New Yourk, pp. 189–202
McManuss M. 1956), On Hatanaka’s note on consolidation, Econometrica, 24(4): 482–487
Miller, R. and Blair, P. (1981), ‘Spatial aggregation in interregional input–output models’, Papers of the Regional Science Association 48, 149–164
Miller R., P. Blair (1985), Input–Output Analysis: Foundations and Extensions. Englewood Cliffs, New Jersey Prentice-Hall.
Miller R.E., Shao Gang. (1990), Spatial and sectoral aggregation in the commodity-industry multiregion input–output model. Environment and Planning A, 22(12):1637–1656
Moromoto Y. (1970), On aggregation problems in input–output analysis, Review of Economic Studies 37(1): 119–126
Moromoto Y. (1971), A note on weighted aggregation in input–output analysis. International Economic Review 12(1):138–143
Murray A.T. (1998), Minimizing aggregation error in input–output models, Environment and Planning A 30(6):1125–1128
Mythili G.. (1995), A note on aggregation error in input–output analysis, Journal of Quantitative Economics 11(2). 149–156
OhUallachain B. (1985), Complementary linkages and the hierarchical structure of regions. Geographical Analysis, 17(2): 130–142
Oksanen B., Williams J.R. (1992), An alternative factor-analytic approach to aggregation of input–output tables. Economic Systems Research 4:245–256
Olsen Asger J. (1993), Aggregation in input–output models: prices and quantities, Economic Systems Research 5(3): 253–275
Paelinck J.H.P. (2000), On aggregation in spatial econometric modeling. Journal of Geographical Systems 2(2):157–165
Ralston S.N., Hastings, S.E., Brucker, S.M. (1986), Improving regional I–O models: evidence against uniform regional purchase coefficients Annals of Regional Science 20(1): 65–80
Round J.I. (1983), Non-survey techniques: a critical review of the theory and evidence. International Regional Science Review 8(3): 189–212
Skolka J. (1964), The Aggregation Problem in Input–Output Analysis. Academy of Sciences, Prague Czechoslovakian
Smith P., Morrison W.I. (1974), Simulating the Urban Economy. Pion, London
Stevens, B.H. and Trainer, G.A. (1976), The generation of error in regional input–output impact models, Working Paper A1–76, Peace Dale, R.I., Regional Science Research Institute
Stone, R., Bates, J. and Bacharach, M. (1963), Input–Output Relationships 1954–1966, Volume three of A Program for Growth Series, Cambridge, MA, The MIT Press
Stone, R. and Brown, A. (1962), A Computable Model of Economic Growth, Volume one of A Program for Growth Series, London, Chapman and Hall
Stover M.E.. (1994), A comparison of annual and benchmark input–output tables in regional economic modeling. Annals of Regional Science 28(2):223–228
Tilanus, C. and Theil, H. (1965), ‘The information approach to the evaluation of input–output forecasts’, Econometrica 32, 4
Teibout C.M. (1969), An empirical regional input–output projection model. Review of Economics and Statistics 51:334–340
Theil H.. (1957), Linear aggregation in input–output analysis. Econometrica 25:111–122
Theil H. (1967). Economics and Information Theory. Rand McNally, Chicago
Theil, H. and Uribe, P. (1992), Henri Theil’s Contribution to Economics and Econometrics, Volume 2, Consumer Demand Analysis and Information Theory Advance Studies in Theoretical and Applied Econometrics, 24, Norwell, MA, Kluwer Academic, 955–980
Treml V.G., Gallik D.M., Kostinsky B.L., Kruger K.W. (1972), The Structure of the Soviet Economy: Analysis and Reconstruction of the 1966 Input–Output Table. Praeger Publishers Inc., New York
Treml, V.G., Gallik, D.M., Kostinsky, B.L., Kurtzweg, L.R. and Tretyakova, A.F. (1976), ‘The Soviet 1966 and 1972 Input–Output Tables’, Soviet Economy in a New Perspective, Joint Economic Committee, Washington, DC, U.S. Congress
Williamson R.B. (1970), Simple input–output models for area analysis. Land Economics 46(3): 333–338
Yamada I. (1961), Theory and Application of Interindustry Trade. Kinokuniya Book Co., Tokyo
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Jalili, A.R. Impacts of Aggregation on Relative Performances of Nonsurvey Updating Techniques And Intertemporal Stability of Input–Output Coefficients. Econ Change 38, 147–165 (2005). https://doi.org/10.1007/s10644-006-9000-2
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s10644-006-9000-2