Testing aggregation consistency across geography and commodities

Abstract

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. © Australian Agricultural and Resource Economics Society Inc.