J. Ital, Statist. Soc.

(2000)
1-3,pp.183-198

FITTING A FUZZY CONSENSUS PARTITION TO A

SET OF PARTITIONS TO ANALYZE THE MODERN
ECONOMIC GROWTH ACROSS COUNTRIES

M. Grazia Pittau*
Universita di Roma «La Sapienza», Italy

Maurizio Vichi
Universita di Roma «La Sapienza», Italy

Summary

In this paper the economic development of a set of countries from 1975 to 1995 is estimat-
ed by considering different variables, reflecting the degree of the Modem Economic
Growth, MEG, that is the economic progress of nations as a whole (Kuznets, 1966). In
each year of the analysis (h = 1,... , r) the MEG is investigated by a fuzzy partition of the
n countries measured by four macroeconomic indicators. Since the objective of this paper
is to catch the different aspects of the MEG not only in each year but also over the entire
period, a new model is developed. In particular, according to the least-squares fitting
criterion, a consensus fuzzy partition is introduced for fitting the best fuzzy partition to P,
being P the set of r fuzzy partitions of the same set of the n countries. The results show
that the empirical MEG is well approximated by two groups in 1975, 1980 and 1985,
representing two well separated clusters of underdeveloped and developed countries. In
1990, these two clusters tend to split into three groups and the third group includes the
countries characterised by a marked acceleration in the rate of output growth. The optimal
number of clusters is determined by generalising the empirical test proposed by Calinski
and Harabasz (1974) to detect the optimal number of classes of a crisp partition.

Keywords: Fuzzy Partition, Consensus Partition, Median Partition, Test for the number of
classes, Modem Economic Growth.

* Address for correspondence: Dipartimento di Contabilita Nazionale e APS, Univer-

sita di Roma «La Sapienza», P.le Aldo Mora 5 - 1-00185 Roma, Italy. E-mail:
grazia.pittau@uniromal.it

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 M. GRAZIA PITIAU . M. VICHI

1. Introduction

In recent years, the debate of economic convergence has dominated the empirical
literature on the economic growth across countries and much effort has been
devoted in measuring and explaining the economic growth, applying various sta-
tistical tools (see, among others, Bianchi, 1997; Quah, 1996, 1997). The tradition-
al approach to convergence analysis is the f3-convergence regression, a cross-
section regression of per-capita income growth rates on initial levels of income.
A negative coefficient implies that regions starting poor grow faster than regions
starting rich. However, as pointed out by Quah (1996), averaging out cross-sec-
tion information by looking at coefficients in a cross-section regression does not
provide adequate information on how countries perform relative to each other.
Alternatively, convergence can be analysed through the evolution of the disper-
sion of per capita incomes, typically measured by the standard deviation: a de-
creasing dispersion indicates o-convergence. From the viewpoint of o-conver-
gence, on the other hand, is not possible to assess some important characteristics
of the distribution, since, for example, a constant dispersion could hide persistent
inequality and disparities, clearly evidencing of non convergence. Recently, the
empirical studies have centred on the evolution of the entire cross-sectional distri-
butions in addressing the mobility patterns within the distribution (see, for exam-
ple, Bianchi, 1997; Quah, 1997). On the whole, all these methods consider only
the per-capita GDP as the only variable able to measure the economic growth.
Since the aim of this paper is to measure and explain the nature of Modern Eco-
nomic Growth - MEG - (Kuznets, 1966), more than one variable must be meas-
ured in order to catch the different features of the process of development. Fol-
lowing this approach, each developed country is characterised by high rates of
growth accompanied by shifts in resource allocation. In fact, one of the major
thrusts of MEG is that massive structural changes in the economy and society are
a necessary and integral part of the process of economic growth. The pattern of
change encompasses the shift from agriculture to industry and services. To obtain
a better insight into the economic development across countries, the per-capita
GDP is supported by other variables reflecting the structural changes in the econ-
omy and the MEG will be modelled by afuzzy classification approach, which
provides a fuzzy partition of the n countries in an appropriate number of compo-
nents. The fuzzy clustering represents a very flexible classification approach, in
fact each object (country) is assigned to a group with a fixed probability, called
membership coefficient, that represents the probability that each country charac-
terised by a set of economic indicators, comes from the l-th component of the
partition. The flexibility of the fuzzy classification is related to the possibility of
describing some ambiguities occurring when objects are not clearly connected
with others in the body of the data. Moreover, it is possible to identify, in probabi-
listic terms, which country belongs to the different groups of the fuzzy partition

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 FITTING A FUZZY CONSENSUS PARTITION TO A SET OF PARTITIONS

and the membership function reveals the objects strongly related to each class and
those marked by a loose association. Over time, the intra-group movement of the
selected countries within the estimated classes can be analysed by means of the
membership coefficients. Since there is no a priori information regarding in how
many groups the fuzzy partition consists, the selection of the smallest number of
classes compatible with the data will be assessed by an extension to fuzzy parti-
tions, of the criterion for crisp partitions proposed by Calinski and Harabasz (1974).
The MEG in each year is described by a fuzzy partition and groups of coun-
tries characterised by similar level of modem economic growth are obtained I.
However, the fuzzy clustering allows us to investigate the MEG year-by-year but
not for the whole period. To synthesize how the MEG evolves over time without
loosing information regarding the level of the modem economic growth in every
year of the analysis, a new model, the consensus fuzzy partition, is proposed. In
particular, this paper deals with the problem of fitting a single consensus fuzzy
partition to the set of r fuzzy partitions, corresponding to r separated cluster
analyses. The r fuzzy partitions have been obtained by fuzzy classifying the same
set of objects, the selected countries, described by a set of variables in different
times. This approach provides a probabilistic clustering of the n countries in terms
of their estimated degree of membership to the g clusters of the fuzzy partition
for the entire observational period. The main advantage of the proposed method-
ology is that the economic pattern can be observed at each period of time and in
the long-period. The 'long period growth rate' is obtained by minimizing the loss
of information contained in the initial patterns.
However, the problem of finding a single consensus partition of the set P is not
easy to solve because classes of partitions obtained by a clustering procedure, at
different times, may change composition over time. Furthermore, the number of
classes may also vary and therefore the problem of comparing partitions in order
to obtain a consensus becomes more complex. In this paper much effort will be
devoted to present a methodology that gives an efficient answer to this problem,
and the optimisation approach, introduced by Barthelemy et al. (1986) to find the
median tree of a set of trees, will be followed. Specifically, defined a loss function
between the set of observed fuzzy classifications and a consensus, the fuzzy con-
sensus is obtained by minimizing this function over the set of all fuzzy partitions.
An outlined of the material in this paper is as follows. In Section 2 the method-
ology for obtaining a single fuzzy partition is briefly described. The associated
practical problem of choosing the optimal number of groups in the partition is
also investigated. The selection of the statistical units and the data-set are pre-
sented in Section 3, along with the empirical results of the fuzzy partition of the

1. The socio-economic empirical analysis is fully described in the Ph. D. thesis of M.

Grazia Pittau.

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 M. GRAZIA PITIAU . M. VICHI

21 selected countries, according to their modem economic growth rate. In Sec-

tion 4 some relevant notations and the consensus fuzzy partition are presented.
The loss function between fuzzy partitions and the consensus is also highlighted.
Section 5 presents the empirical results of the MEG in the period of analysis.
Finally, some conclusions are given in Section 6.

2. Fuzzy Partitions and the selection of the optimal number of groups

A fuzzy partition of a set of n units provides an extremely flexible method of

classifying heterogeneous statistical units, described by multivariate profiles, units
that apparently cannot be modelled by a crisp classification. In this paper, we
refer to the fuzzy c-means algorithm, a clustering algorithm which finds fuzzy
partitions by minimizing a distance-based objective function (Bezdek, 1981).
Formally, the generic fuzzy classification of the n units into g groups in a
situation (occasion) h, in this paper representing each year of the analysis, is
obtained by solving the following non linear constrained problem (Dunn, 1974;
Bezdek,1981):

n s,
minIIw;A~h
i=l 1=1

gh (PI)
subject to I Wilh = 1 and With 2: 0; i = 1,... ,n; 1,... ,n; 1,... ,gh; h = 1,... .r
l=l

where With E W h is the membership coefficient that quantifies the degree of mem-
bership of unit i to the group I. Therefore, the matrix W h = [Wi/h] is the n x gh
membership matrix specifying the fuzzy partition Ph into gh classes. The constant
m » 1 represents the degree of fuzziness of the partition, while dilh =IIXih - zlhll is
the euclidean distance between the object X ih =(X i l h, •.• , X iph, ... , X ikr) , representing
the mul~ivariate profiles of the ith statistical unit in the occasion h, and the fuzzy
n n
centroid Zlh =I (wi/h)m Xih / I (Wilh)m .
i=1 i=l
The solution of (P1) provides the membership coefficients of object i to the
cluster I, representing the probability that the ith country with economic profile Xi
belongs to the lth group of the partition'.
Although the implementation of the fuzzy c-means algorithm requires a fixed
number of clusters, in the fuzzy classification literature the problem of finding

2. See Bezdek (1981) and Kaufman and Rousseeuw (1990) for a detailed account.

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 FITIING A FUZZY CONSENSUS PARTITION TO A SET OF PARTITIONS

the best number of classes for a fuzzy partition has not been deeply analysed. Fur-
thermore, as previously pointed out, for the cross-country MEG analysis there is
no information a priori regarding the number of groups in the classification proce-
dure. When there is no a priori information, a more formal way to identify the best
number of classes compatible with the data is to test for the number of groups.
In this paper, the criterion proposed by Calinski and Harabasz (1974) for crisp
partitions will be followed and generalised. This criterion has been chosen ac-
cording to his superior peformance in revealing the best recovery of the true
underlying cluster structure, as reported in Milligan and Cooper (1985).
Following Calinski and Harabasz (1974), the stopping rule for determining the
optimal number of clusters in a fuzzy partition can be formally defined as follows:

C(g,n) = {deva/(g-l)}· {(n-g)/dev w\' (1)

where g and n are respectively the number of classes and the number of units to
be classified in the fuzzy partition; dev, and dev., are respectively the within and
between cluster sum of squares weighted by the membership coefficients:

kg"
dev w = LLL(x, p -Xtp ) 2 W ;i' (2)
1'=1/=1 ;=1

" k g
dev; = LLI(.'f IP _Xp ) 2 W " , (3)
1=1 1'=1/=1

n n n X
and »; = LX,pw" ILw",x p= LLx,pw" In.
/=1 /=1 /=! 1=1

The maximum of C(g, n) for different values of g indicates the optimal number of
classes in the data structure. If there are several such local maxima, it will be
most economical to choose the smallest of the related values of g, as suggested
by Calinski and Harabasz (1974).
The fuzzy classification of the selected countries regarding the level of the
MEG is investigated in the next section.

3. Time evolution of the modern economic growth

As pointed out in the introduction, to explain the nature of Modern Economic

Growth, more than one variable must be considered in order to catch the different
features of the process of development. Following this approach, for each coun-

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 M. GRAZIA PITIAU· M. VICHI

try four macroeconomic indicators have been selected according to their perform-
ance in explaining the massive structural changes in the economy and the availa-
bility of the data over time (especially for the underdeveloped countries). The
data-set, available from the World Bank Country Tables and from the World Cen-
sus of Agriculture spans the period 1970-1995. Since year-to-year large move-
ments in the economy structure are not expected to be large, the changes in the
pattern of growth can be observed by analysing selected years as representative of
a specific time period. In particular, the year 1975 stands for mid 1970s, 1980 for
early 1980s, 1985 for mid 1980s, 1990 for early 1990s and 1995 for mid 1990s.
To catch the shift from agriculture to industry and services, characterising a
modem economic development, the annual per-capita GDP is accompanied by
other three macroeconomics indicators: the Agriculture Gross Domestic Product
(AGDP); the Labour force in Agriculture (LFA) and the Gross Domestic Invest-
ment (GDI). The annual per-capita GDP has been reported at constant 1987 US
dollars, while AGDP is expressed as the percentage of Gross Domestic Product
from Agriculture; LFA as the percentage of labour force employed in Agriculture
and GDI as the share on GDp 3 •
In order to appropriately capture the modem economic growth, all the indica-
tors are expressed in terms of index number, dividing each variable by the corre-
sponding value in the first year of the analysis. Therefore, the temporal occasions
will be reduced to four time periods, namely early 1980s, mid 1980s, earl y 1990s
and mid 1990s.
Unfortunately, a time series of all the indicators is not available for a large set
of countries. According to the availability of the data, only 21 countries have
been selected: India, Indonesia, Egypt, Sudan, Bolivia, Chile, Uruguay, South
Africa, Venezuela, Argentina, Portugal, Greece, Spain, United Kingdom, Italy,
Canada, France, Norway, Japan, United States, Sweden. It should be noted that
the last eleven countries are OECD (Organization and Cooperation for the Eco-
nomic Development) members.
For each year, the data set has been classified by the fuzzy c-means algorithm
and the optimal number of groups for g = 1,2,3,4 in the partition have been
selected according to the stopping rule (1), C(g, n).

3. Specifically, the data set regarding the per-capita GDP in local currency at constant
prices comes from World Bank, Country Tables, Oxford University Press, Oxford, (1995);
the exchange rates from the International Monetary Found, Financial Yearbook (1997);
the percentage of employers in agriculture from Food and Agriculture Organization, Sta-
tistical Development, Series 9 (1997), Report on the 1990 World Census of Agriculture.
International comparison and primary results by country; the share of investments on
GDP and the percentage of GDP from agriculture from World Bank, World Development
Report, Oxford University Press, Oxford (various years).

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 FITTING A FUZZY CONSENSUS PARTITION TO A SET OF PARTITIONS

As evident in Table 1, the stopping rule does not reject the hypothesis of two
groups in the fuzzy partitions for the early 1980s, the mid 1980s and for the early
1990s; while during the mid 1990s the test supports the evidence of three groups.
For each partition, the characteristics of the classes are clearly evident from Ta-
ble 2, reporting the values of the fuzzy centroids for each year and for each mac-
roeconomic indicator. It should be noted that the fuzzy centroids for each group
are an average of the scores of the centres of the four macroeconomics indicators,
weighted by the corresponding membership coefficients.

Table 1
The choice of the optimal number ofgroups

Time Number of l!;roups

Z 3 4 5 6
early 1980s Z.94 2.12 U,6 1.18 1.00
mid 1980s 5.35 37 J 365 2.06 1.74
earlv 1990s 8.03 6.07 3.70 3.32 2.56
mid 1990s 2.67 3.69 2.78 0.67 0.67

Table 2
Fuzzy centers values

Groups GOP per-capita GOP from Gross Domestic Labour Force

Agriculture Investment in Agriculture

earl 1980s
J 18 74 122 89
g\
108 ~R 76 87
gz
mid 1980s
gJ In 63 105 67
93 88 53 80
gz
earlv 1990s
153 59 113 62
gl
91 83 47 72
gz
mid 1990s
146 42 88 45
gl
94 78 51 63
gz
200 60 190 61
g3

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 M. GRAZIA PITIAU . M. VICHI

Even though each coordinate of the fuzzy cluster centroids is a weighted aver-
age of the relative variable, in the following analysis for sake of simplicity they
will be identified by the name of the variable.
The estimated membership coefficients for each country and for each year are
reported in Table 3.

Table 3
Membership coefficients of the 21 countries"

Years
Countries
early 1980s mid 19805 early 19905 mid 19905

gl g2 gl 00 gl g2 gl g2 g3
"'-
India O.Sh 0.14 O.SI 0.1 Y O.Sh 0.14 0.45 0.21 0.33
Indonesia O.SY 0.11 0.7h 0.24 08 0.2 0.15 0.07 0.78
Egypt 0.65 0.35 0.60 040 0.82 018 0.52 0.29 0.19
Sudan 0.12 0.S8 0.04 0.96 0.03 0.97 0.17 0.77 0.06
RolivtJ O.IS OS2 0.07 093 0.04 0.96 0.06 0.92 0.02
Chile 0.7.1 027 O.X7 01.1 OS5 o 15 (J.06 0.03 0.91
Uruguay 0.67 0.3] o 12 OSS 0.17 0.83 0.38 0.56 006
South Africa 0.73 027 0.53 0.47 025 0.75 0.28 0.66 0.06
Portugal 0.S8 0.12 0.93 007 0.92 0.08 0.78 0.1 o 12
Venezuela 0.16 0.84 0.26 074 0.12 0.S8 0.1 0.87 0.03
Argentina 0.82 O.IS 0.03 097 0.03 0.97 0.46 0.46 0.08
Greece 0.48 0.52 0.36 064 0.39 0.61 0.34 0.54 0.13
Spain 0.14 0.86 0.77 0.23 0.87 0.13 0.91 0.06 0.03
United Kingdom 0.59 0.41 0.87 o 13 0.9 0.1 0.81 0.14 0.06
Italy 0.94 D.06 0.S9 Oil 0.91 0.09 0.87 0.07 0.06
Canada 0.57 0.43 0.84 0.16 O.SI 0.19 0.84 0.13 0.04
France 0.42 0.58 0.81 019 0.78 0.22 0.87 0.1 0.04
Norway 0.18 0.82 0.79 D21 0.65 0.35 0.76 0.15 0.09
Japan 0.4\ 0.59 0.86 DI4 0.85 DIS 0.75 D.13 0.12
United States D69 0.31 0.95 0.05 D.79 0.21 0.71 0.2 0.09
Sweden 0.39 0.61 076 0.24 0.73 0.27 0.55 039 0.06

For the early 1980s, the first group of the fuzzy partition is characterised by a
very high growth rate for the GDP and for the GDI, while the GDP from agricul-
ture and the labour force in agriculture seem to decrease between the 1970 and
the 1975, suggesting a shift from agriculture to industry and services. The second
group, instead, exhibits a modest growth rate for the GDP accompanied by a

4. The countries are ordered by their per-capita income in 1975.

190
 FITIING A FUZZY CONSENSUS PARTITION TO A SET OF PARTITIONS

small rate of GOI; the others two indicators are not significant different from the
corresponding values in the first group. Therefore, the first group seems to be
suitable to describe a situation of Modem Economic Growth, while the second
group represents a situation of economic stasis. Looking at the estimated mem-
bership coefficients, the two groups seem to be not well separated since the mem-
bership values do not clearly allocate some countries in one of the two groups.
For example, Egypt, Uruguay, Greece, United Kingdom, Canada, France, Japan,
United States and Sweden have probability of belonging to the first cluster rang-
ing from 0.39 to 0.69. In contrast, India, Indonesia, Portugal, Argentina and Italy
have a probability to belong to the 'Modem Economic Growth' group of the
partition greater than 85%, while Sudan, Bolivia, Venezuela, Spain, Norway be-
long to second group with a probability larger than 80%. Observe that the groups
have been identified by the growth rate of the indicators expressed as index num-
bers, and not by considering the absolute values of the variables. This explains
why, for example, Norway and Sudan belong to the same group: both the two
countries are characterised by a moderate rate of growth in term of GOP and
GOI, even if Norway is a rich country and Sudan a poor country.
A two-group partition is also compatible with the mid 1980s data (see Table
1), but with different features of the groups. In the first group, the value of LFA
has noticeably decreased with respect to the previous year, while the other indi-
cators are not significantly different. This means that the countries belonging to
this group are characterised by a tendency towards an economy orientated to
industry and services rather than to agriculture. The main difference in the sec-
ond group is the value below 100 of GOP revealing a decrease of per-capita
income between 1975 and 1985 for all the countries belonging to this group.
Furthermore, the groups detected in the mid 1980s seem more separated since
only three countries, Egypt, South Africa and Greece, have a probability to be-
long to one of the two groups less than 70%.
Significant movements of the countries from the 'MEG growth' group and the
'economic stasis' group and vice versa can also be detected. For example, be-
tween the early 1980s and the mid 1980s the probability of belonging to the first
group drops from 67% to 12% for Uruguay, from 73% to 53% for South Africa,
from 82% to 3% for Argentina and from 48% to 36% for Greece; while rises
from 0.59% to 87% for United Kingdom, from 18% to 79% for Norway, from
41% to 86% for Japan and from 39% to 76% for Sweden. Furthermore, the number
of countries belonging to 'MEG growth' groups, with a membership coefficient
larger than 0.64, increases from 10 to 13.
The fuzzy partition in the early 1990s does not significantly differ from the
partition in the mid 1980s, even though some differences can be detected. In the
first class, still representing a group of 'growing' regions, the GOP and the GDI
rose from 128 to 153 and from 105 to 113 respectively, while the AGOP and the
LFA exhibit a regular decreasing pattern. The second group is approximately

191
 M. GRAZIA PITIAU . M. VICHI

compatible with the previous 'economic stasis' group and does not show remark-
able changes in the centroids coordinates.
All the countries emphasise a substantial stability and the only country which
moves from one group to the other is South Africa, having a probability to belong
to the second group of 0.75 with respect to the previous 0.47 in the mid 80's.
As reported in Table 2, in the period 1975-1995 the fuzzy partition is well
described by three groups. The first group roughly corresponds to the 'MEG
growth' group, although it is characterised by a weighted average ofGDI in 1995
smaller than the value in 1975. The second group still represents the 'economic
stasis' group, while the third presents a very high growth rate of the GDP along
with a high value of GDI. Therefore, this class seems to be appropriate to de-
scribe a situation of marked acceleration in the rate of output growth not associat-
ed with important structural changes, as the movements of resources from low to
high productivity sectors and the primary-secondary-tertiary shift in the industri-
al structure. This situation is representative of the economies based on the export
of refined oil, that are often rich but not socially and economically developed.
The achieved membership coefficients show that Indonesia and Chile belong to
this group with a probability greater than 0.75; India and Egypt with a probability
0.33 and 0.19 respectively. It is interesting to remark that also two European coun-
tries, Portugal and Greece, and Japan have a probability greater than 0.10 of be-
longing to this group. However, while Portugal and Japan have a probability to
belong to the 'MEG growth' group equal to 0.78 and 0.75 respectively, India, Egypt
and also Greece belong to this group with a membership value less than 0.33.
Summarising, the 21 selected countries, developed and not, exhibit in the 1980s
and in the early 1990s a polarization in two disjointed groups of countries. The first
group including all the economies characterised by similar level of modem eco-
nomic growth: high rate of output growth accompanied by important structural chang-
es. The second group includes all the economies in a situation of economic stasis.
On the whole, if the countries are observed in terms of their Modern Economic
Growth, there is no evidence of a convergence process in the last twenty years.
In order to observe the economic pattern of modem growth in the long-period,
ajuzzy consensus partition has been fitted. This new methodology allows us to
estimate the membership coefficients for each country for the entire period under
observation, compatible with the probabilities estimated at each period of time.
The proposed method will be illustrated in detail in the next Section 4, while
the main empirical results will be reported in Section 5.

4. The consensus fuzzy median partition

Let us first introduce some notations for the following. Formally, let P =
{PI"'" P r } denote the r different fuzzy partitions, related to r different times; let

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 FITIING A FUZZY CONSENSUS PARTITION TO A SET OF PARTITIONS

n be the number of objects to be partitioned; 1= {0 1 , ••• , 0i"'" On} the set of n

objects to be partitioned; r the number of different partitions of I; Ph the hth given
partition of I; gh the number of classes in Ph' For the generic fuzzy partition
h (h = 1,... , r), let W h = [Wi/h] be the n X gh membership matrix specifying the
fuzzy partition Ph into gh classes of I, and Wi/h the membership coefficient of
object i to class l, at occasion h. The set 7Q = {WI ,... , W} represents the collec-
tion of the r membership matrices of I, while Yh = [Yijh] = W h W' h is the n x n joint
g"
membership matrix, where elements Yij/" such that 0 ~Yijh s land Yijh = I, Wi/h W j lh'
1;[
specify the joint probability of a pair of object to belong to a class, expressed as
the joint membership coefficient of OJ and OJ (i,j = 1,... , n) to a same class of the
fuzzy partition Ph (h = 1,... , r). When elements of W h are 0 or 1 the matrix Yh has
elements 0 or 1, with Yi/h = 1 if object O, and OJ belong to the same class, 0
otherwise. The number of classes of the consensus partition is indicated by g and
the n x g membership matrix specifying a consensus partition Pinto g classes of
I by W = [wuJ, where Wi/ is the membership coefficient of object i to class [.
The matrix Y = [Y,J is instead the n x n joint membership matrix of the
g

consensus partition whose elements are such that 0 ~Yij~ l,and Yij = I, Wi/W j l
1;1
denotes the joint membership coefficient of O, and OJ to a same class l of the
consensus.
The Wilh are required to satisfy the following conditions:

Wi/h ;?: 0; (i = 1,... , n; [= 1,... , gh; h = 1,... , r), (4)

gh
L Wi/h =1, (i =1,... .nih > 1,... ,r), (5)
1;[

while the membership functions Yi/ satisfy:

Yi/;?:O,(i= 1,... .n: [= 1,·.. ,gh) (6)

LYi/ = 1,
1;[
(i = 1,... ,n). (7)

The problem of obtaining a single consensus partition P is formalized by postu-

lating that partitions Ph (h = 1,... , r) are the same, except for errors (e.g., meas-
urements errors and/or sampling errors), and therefore no systematic differences
between them occur. This hypothesis needs to assume that a single consensus

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 M. GRAZIA PITIAU . M. VICHI

fuzzy partition suffices to represent the set P == {p!, ... , P,}. Multiple consensus
partitions (Gordon and Vichi, 1998) for fuzzy classification are not discussed in
this paper.
Let

(8)

denote the measure of difference between two partitions Ph and Pm. Note that, if
every pair of objects belongs completely (or does not belong at all) to a same
class (i.e ., Ph and P'; are crisp partitions), then zi indicates the number of pairs of
objects which belong to different classes in Ph and Pm.
The consensus problem may be statistically formalized as a constrained least-
squares fitting problem as follows:

r
min L.1(~"P)
h=!
subject to
Y« 2: 0, i =I,... .n; 1= l,... ,g (P2)
g

LYi! =1, i =1,.. ..n

1=1

The solution of (P2) is the fuzzy median partition.

When the r fuzzy partitions have the same number of classes g, it is easy to
show that problem (P2) has an analytical solution given by the arithmetic mean
matrix of the membership matrices (Pittau, 1998). However, S» generally differs
for each occasion h and an easy analytical solution cannot be found.
Problem (P2) is equivalent to the following quadratic programming problem
constrained on the variables Wi! (i = 1,... , n; 1= 1,... , g):

Wi! 2: 0, i =1, .. ..n; I = 1, ... ,g (P3)

g

LWil =1, i=I, ... ,n

1=1

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 FITTING A FUZZY CONSENSUS PARTITION TO A SET OF PARTITIONS

The equivalence between (P2) and (P3) is a consequence of the following results:
i) the constraints on the set {Wi/: 1 ~ i ~ j ~ n} specify a fuzzy partition;
ii) the following decomposition holds:

r n-l Ii r n-l n 11-1 n

III
h=l i=l j=;+1
(Yijh - Yij)2 = II I
h=l ;=[ j=;+1
(Yijh - Yij)2 +r I I
i=l j=i+l
(Yij - Yij)2 =
n-I 11 r gil

constant + r I I (Yij - Yij)2, where s; = r- 1I I W;lh Wj/h'

i=1 j=;+l h=l 1=1

Problem (P3) can be solved by using a Sequential Quadratic Programming (SQP)

algorithm. Comparative studies of non-linear programming indicate that SQP
performs very well in terms of efficiency, accuracy and of successful solutions
with a super-linear rate of convergence (Powell, 1983). However, since the SQP
algorithm does not guarantee the global optimum solution, in this paper, to over-
whelm this problem many randomly started values have been considered in im-
plementing the procedure.
The consensus fuzzy algorithmic is finally applied to find the long-period
modern economic growth rate.

5. The long period Modern Economic Growth

The SQP algorithm detected the fuzzy consensus partition after 453 interations
(requiring the termination tolerance for variables and objective function to be
equal to 10-4 and for constraint violation to be equal to 10--6). The identified fuzzy
partition consists of two groups.
The first group roughly corresponds to the 'MEG growth' group, while the
second group to the 'economic stasis' group. In the long run analysis, the third
group identified in the mid 1990s seems to be vanished.
Table 4 reports for each country the estimated membership values for the twen-
ty-years period. Looking at the membership values it is evident that all the OECD
members, except Greece, have a probability of belonging to the first group great-
er than 0.60. This group consists of all the economies characterised by significant
structural changes in their economy in terms of high rate of output growth ac-
companied by important structural changes, as the shift from primary industrial
structure to a secondary-tertiary structure.
Specifically, Spain and Portugal, that in the early 1980s were 'poor' countries,
in the consensus analysis belong to the 'MEG growth' group with a probability of
0.87 and 0.62 respectively. This feature indicates that the gap between Spain and
Portugal and the rich countries has decreased over time, revealing a tendency of
the two countries to fill the gap with the rich economies.

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 M. GRAZIA PITTAU . M. VICHI

Table 4
Consensus membership coefficients of the 21 countries

Countries early 1980s-mid 1990s

g, g2
India 0.77 0.23
Indonesia 0.73 0.27
Egypt 0.66 0.34
Sudan 0.07 0.93
Bolivia 0.07 0.93
Chile 0.75 0.25
Uruguay 0.28 0.72
South Africa 0.41 0.59
Portugal 0.87 0.13
Venezuela 0.15 0.85
Argentina 0.25 075
Greece 0.38 0.62
Spain 0.69 0.31
United Kingdom 0.79 0.21
Italy 0.87 0.13
Canada 0.76 0.24
France 0.72 0.28
Norway 0.62 0.38
Japan 0.74 0.26

Furthermore, it shows a lower probability to belong to the first group if com-

pared with the probability of Portugal. This difference reflects the time behav-
iour of the two countries, in fact while Portugal belongs to the 'MEG growth'
group with a high probability in all years, Spain instead, in the early 1980s was
characterized by a very low modem economic growth rate. This behaviour is
detected in the consensus partition. The consensus analysis is able to identify the
long period evolution without ignoring the characteristics of the countries in each
year of the period.
The most 'modem economic stable' European country is Greece as it is evi-
dent from its probability to belong to the' economic stasis' group, revealing neg-
ligible transformations in its economic structure during the period of twenty-
years. Uruguay, Venezuela and Argentina are characterised by insignificant eco-

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 FITIING A FUZZY CONSENSUS PARTITION TO A SET OF PARTITIONS

nomic transformations, as revealed by their low membership coefficients to the

first group of the consensus analysis. On the contrary, India, Indonesia, Egypt
and Chile have a high probability of belonging to the first group although they
are undeveloped economies, suggesting a tendency of these countries to con-
verge to the modem economic countries in the long period.
The most critical situation refers to Sudan and Bolivia, very poor countries
and characterised by a very low modem economic growth rate, that indicates an
increasing gap between these economies and the developed countries.

6. Concluding remarks

In this paper the Modern Economic Growth of a set of 21 countries has been
analysed in a period of twenty-years, from 1975 to 1995. The Modern Economic
Growth has been measured by four macroeconomic indicators in order to catch
the different features of the process of development, as for example shifts in
resource allocation. The pattern of change has been modelled every year by a
fuzzy classification approach, which has provided a fuzzy partition of the 21 coun-
tries in an appropriate number of classes. Since this procedure provides a proba-
bilistic clustering of the countries, each country has been assigned to a group
with a fixed probability, called membership coefficient, representing the proba-
bility that the country with a certain set of economic indicators belongs to the
generic group of the partition.
The optimal number of groups in each year of the analysis has been chosen
according to a fuzzy generalization of the Calinski and Harabasz procedure.
The empirical results show that the 21 economies in the early 1980s, in the
mid 1980 and in the early 1990s can be divided in two well separated clusters of
modem economic growing countries and economically stable countries, respec-
tively. In the last year of analysis a new group has been detected. To this group
belong the countries characterised by a marked acceleration in the rate of output
growth, but with no significant changes in their economic structure. Over time
this group seems to vanish and in the long period analysis only the two groups
persist. The long run analysis has been performed by the fuzzy consensus classi-
fication that gives over the entire period the probability to belong to each group
for each country.
This fuzzy consensus classification simplifies the problem of summarizing
several fuzzy classifications obtained when the same data set is observed in dif-
ferent time periods. Particularly, the median fuzzy classification simplifies this
matter detecting the best fuzzy classification, according to the LS criterion, by
fitting a set of r fuzzy partitions of the same set I of n objects.
It should be noted that, in general, the median fuzzy partition has many prac-
tical applications. It can be used also to synthesise r fuzzy classifications of I

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 M. GRAZIA PITIAU' M. VICHI

obtained on the basis of: r sets of different variables; r sets of the same set of
variables observed in r different occasions; r applications of the fuzzy c-means
algorithm with r different values of the fuzzy parameter. Although the SQP pro-
cedure is sufficiently efficient, further studies are needed to find more computa-
tionally efficient algorithms.

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