Structural decomposition analysis with disaggregate factors within the Leontief inverse

Abstract A trivial case in input–output structural decomposition analysis is a of product variables, or factors, where one factor an inverse—typically, Leontief inverse—of sum other factors. There may be dozens and hundreds such factors that describe the changes subsets technical coefficients. The existing literature offers ambiguous guidance this case. solution consistent with index number theory virtually infeasible. simplified ad hoc solutions require researcher to make arbitrary choices, lead biased estimates do not ensure consistency-in-aggregation This paper reviews said problem describes numerical test identify best-performing solution. It found calculating average two polar forms for each superior approximations terms minimising errors.