Approximate separability and aggregation (Q1100081)

This note renews the concern of F. F. Fisher for the possibility of approximate aggregation. A geometric measure is introduced to gauge directly the extent to which a group of variables is separable relative to a given function. Bounds on the tightness of approximation of a function by separable ones are derived in terms of this geometric measure and the moduli of continuity of the function. The main conclusion is that approximate aggregation is unlikely to be possible unless the function is approximately separable. Hence, known stringent conditions for the existence of economic aggregates cannot be easily evaded.