Aggregation may be harmful but cannot always be avoided in the analysis of complex econometric models. It should be … carried out intelligently by choosing ein aggregative model optimally for modes of aggregation speeified in advance, i ….e. minimizing the bias introduced by aggregation and mea-sured by a formula based on the mean-square forecast error. This leads to …

of the problem of choosing an aggregative model optimally for modes of aggregation specified in advance leads to a … formula for the aggregation bias based on the mean-square forecast error. Taking this formula as objective function one would … wish to choose a grouping that minimizes aggregation bias. Unfortunately this results in an optimization problem of a high …

The paper presents a general theory of the aggregation of prices and quantities that unifies the field and relates … topics that in the past have been treated separately and unsatisfactorily, or not at all. The theory does without the common … the theory lead to Törnqvist indexes defined on the appropriate data set. A numerical example confirms that in the non …