Definition: Top-down methods

Category: Regional accounts and indicators

The top-down methods of estimating a regional aggregate involves collecting data at regios, without attempting to single out the local KAU or local unit. The national figure is distributed using an indicator which is as close as possible to the variable to be estimated. For example wages and salaries might be allocated to regions using total employment multiplied by average earnings from a different statistical source.
The method is named top-down because the aggregate is allocated to a region and not to a local KAU or local unit. However, the notion of local KAU or local unit is, in most cases, still needed to produce the correct regional allocation.