On the extrapolation with the Denton proportional benchmarking method

Statistical offices have often recourse to benchmarking methods for compiling quarterly national accounts (QNA). Benchmarking methods employ quarterly indicator series (i) to distribute annual, more reliable series of national accounts and (ii) to extrapolate the most recent quarters not yet covered by annual benchmarks. The Proportional First Differences (PFD) benchmarking method proposed by Denton (1971) is a widely used solution for distribution, but in extrapolation it may suffer when the movements in the indicator series do not match consistently the movements in the target annual benchma