The Information Approach to the Aggregation of Input-Output Tables
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In a recent publication by the Czechoslovak Academy of Sciences, Jiri Skolka (1964) suggested information measures for the value of input-output tables as well as an information criterion for the aggregation of such tables.1 When sectors are combined to groups of sectors, a smaller input-output table is the result, the information value of which (to be defined appropriately) is always less than or equal to that of the original tables. The information reduction can be decomposed into various terms, some of which were given an economic interpretation by Skolka. The objective of the present paper is to present the information decomposition for the general case of n sectors aggregated to G groups of sectors, to apply the result to the annual postwar input-output tables of the Netherlands, to formulate and apply an approach for partial disaggregation, and to relate the information criterion to the classical input-output problem of predicting intermediate and primary demand. These respective goals will be pursued in sections 2 through 5, 6 and 7, 8, and 9.
KeywordsFinal Demand Aggregate Output Secondary Sector Group Flow Input Coefficient
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