Levels of Aggregation: A Conceptual Model

Aggregate analysis has been established as a standard method on the study of market response behavior for a long time. Aggregation has advanced our understanding of the linkages among social characteristics and aggregate response behavior. However, aggregate analysis has been hindered by fragmentary and unsystematic procedures to determine the most appropriate level of aggregation. The general objective of this paper is to provide a conceptual framework to determine the level of aggregation of variables in data analysis. In addition, statistical procedures are suggested in this framework to verify and to determine the level of aggregation represented by a variable. The conceptual framework is useful for deciding if the variables are to be analyzed from micro-analysis focus or macro-analysis focus. The statistical procedures enable the researcher to systematically identify and verify the level(s) of aggregation of variables in an existing data set.