Definition: Double deflation

Category: OECD terminology

Broadly defined:
Procedure to obtain a measure of deflated value added that is based on a price index that combines the price index of gross output with the price index of intermediate inputs.

Narrowly defined:
Procedure to obtain a volume measure of value added by subtracting intermediate inputs at constant prices from gross output at constant prices. Subtraction of levels implies that constant prices reflect Laspeyres-type quantity indices. http://ec.europa.eu/eurostat/ramon/statmanuals/files/oecd_measuring_productivity_2001_en.pdf