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Testing aggregation consistency across geography and commodities

  • Qinghua Liu
  • C. Richard Shumway

Consistent aggregation of production data across commodities and Western USA states was tested using Lewbel's generalised composite commodity theorem. The applicability of the generalised composite commodity theorem for testing consistent geographic aggregation was demonstrated and applied to two groups of states. Consistent commodity aggregation was tested in each state for two output groups and three input groups and in one state for a larger number of groups. Most tests for commodity aggregation supported consistent aggregation of inputs but not outputs. Consistent geographic aggregation was supported for each output and input category across Pacific Northwest states but only for inputs across all Western states. Copyright Australian Agricultural and Resource Economics Society Inc. and Blackwell Publishing Ltd 2004.

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Article provided by Australian Agricultural and Resource Economics Society in its journal Australian Journal of Agricultural & Resource Economics.

Volume (Year): 48 (2004)
Issue (Month): 3 (09)
Pages: 463-486

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Handle: RePEc:bla:ajarec:v:48:y:2004:i:3:p:463-486
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