Econometrica: Jul, 1979, Volume 47, Issue 4
Iterative Aggregation--A New Approach to the Solution of Large-Scale Problems
A. A. Ryvkin, I. Y. Vakhutinsky, L. M. Dudkin
In large and complicated management systems, solutions with the same indices, but with different degrees of aggregation, are used and coordinated. For example, in hierarchical systems, those in higher management levels make decisions with more aggregated indices than those in lower management levels. Managers of an individual subsystem within a large and complicated system use detailed information about their own subsystem and aggregated information (in some degree or other) about other subsystems. The principal idea of the iterative aggregation method is to consecutively recompute the aggregated indices characterizing the activities of the whole system, followed by a recomputation of the detailed indices characterizing each of its subsystems. From a theoretical point of view these methods are generalizations of some classes of iterative and decomposition methods.