Comparing structural decomposition analysis and index
To analyze and understand historical changes in economic, environmental, employment or other socio-economic indicators, it is useful to assess the driving forces or determinants that underlie these changes. Two techniques for decomposing indicator changes at the sector level are structural decomposition analysis (SDA) and index decomposition analysis (IDA). For example, SDA and IDA have been used to analyze changes in indicators such as energy use, CO2-emissions, labor demand and value added. The changes in these variables are decomposed into determinants such as technological, demand, and structural effects. SDA uses information from input-output tables while IDA uses aggregate data at the sector-level. The two methods have developed quite independently, which has resulted in each method being characterized by specific, unique techniques and approaches. This paper has three aims. First, the similarities and differences between the two approaches are summarized. Second, the possibility of transferring specific techniques and indices is explored. Finally, a numerical example is used to illustrate differences between the two approaches.
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- Xiaoli Han & TK. Lakshmanan, 1994. "Structural Changes and Energy Consumption in the Japanese Economy 1975-95: An Input-Output Analysis," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3), pages 165-188.
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- Ang, B.W. & Zhang, F.Q., 2000. "A survey of index decomposition analysis in energy and environmental studies," Energy, Elsevier, vol. 25(12), pages 1149-1176.
- Rutger Hoekstra & Jeroen van den Bergh, 2002. "Structural Decomposition Analysis of Physical Flows in the Economy," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 23(3), pages 357-378, November.
- Erik Dietzenbacher & Bart Los, 1998. "Structural Decomposition Techniques: Sense and Sensitivity," Economic Systems Research, Taylor & Francis Journals, vol. 10(4), pages 307-324.
- Erik Dietzenbacher & Alex R. Hoen & Bart Los, 2000. "Labor Productivity in Western Europe 1975-1985: An Intercountry, Interindustry Analysis," Journal of Regional Science, Wiley Blackwell, vol. 40(3), pages 425-452.
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