Matrix aggregation
In piar: Price Index Aggregation

Aggregating a price index can be done as a matrix operation. Although this approach is less flexible than the aggregate() method used in vignette("piar") (i.e., there can be no missing elemental indexes), it can be considerably faster for larger indexes.

Let's start by building the index in vignette("piar") again.

library(piar)

# Make an aggregation structure.
ms_weights[c("level1", "level2")] <- 
  expand_classification(ms_weights$classification)

pias <- ms_weights[c("level1", "level2", "business", "weight")] |>
  as_aggregation_structure()

# Make a fixed-base index.
elementals <- ms_prices |>
  transform(
    relative = price_relative(price, period = period, product = product),
    business = factor(business, levels = ms_weights$business)
  ) |>
  elemental_index(relative ~ period + business, na.rm = TRUE)

index <- elementals |>
  aggregate(pias, na.rm = TRUE) |>
  chain()

index

The key to do this aggregation as a matrix operation is to first turn the aggregation structure into an aggregation matrix.

pias_matrix <- as.matrix(pias)

pias_matrix

Multiplying this matrix with a matrix of fixed-base elemental indexes now computes the aggregate index in each time period.

pias_matrix %*% as.matrix(index[levels(pias)$business])

Computing the shadow of an index

It's often useful to determine which higher-level index values are missing, and subsequently get imputed during aggregation (i.e., compute the shadow of an index). This is simple to do if there's an elemental index for each elemental aggregate in the aggregation structure.

The idea is to aggregate an indicator for missingness to get a matrix that gives the share of missing elemental indexes for each higher-level index.

pias_matrix <- as.matrix(pias) > 0 

pias_matrix %*% is.na(elementals) / rowSums(pias_matrix)

A value of 1 means that there are no non-missing elemental indexes, and that the value for this level of the index is imputed from its parent in the aggregation structure. A value below 1 but above zero means that some but not all elemental indexes are missing, and the index value for this level is based on the non-missing elemental indexes. A value of zero means there's no imputation for this level of the index.

Sparse matrices

Aggregation structures are naturally sparse. Although using a dense aggregation matrix does not matter for small indexes, it quickly becomes inefficient for large indexes---in this case it is better to make a sparse aggregation matrix.