DEFLATION OF INPUT-OUTPUT TABLES FROM THE USERS POINT-OF-VIEW - A HEURISTIC APPROACH

This paper considers the problem of deflating an input-output table fr om the viewpoint of the user. In many practical cases certain margins of this table are readily available in constant prices, whereas the en tire table is not. This reduces the problem to estimating the matrix o f sectoral intermediate deliveries in constant prices. The traditional approach for this purpose is based on the double deflation method. Si nce double deflation is sensitive to aggregation, however, it typicall y does not provide correct answers. Therefore, a heuristic approach is proposed as an alternative. It is based on the biproportional project ion method. An empirical evaluation indicates that the heuristic appro ach clearly performs better.