IT IS SHOWN THAT CERTAIN LARGE, MULTIPRODUCT PROBLEMS CAN BE WELL APPROXIMATED BY SMALLER MODELS OF THE SAME FORM, REPRESENTING ONLY ONE AGGREGATE PRODUCT (OR A FEW SUCH PRODUCTS). THIS REDUCTION FOLLOWS FROM A NEW TECHNIQUE TO APPROXIMATETHE MINIMAL COST OF A SPECIAL ALLOCATION OR ″ DISAGGREGATION ″ PROBLEM, BY A SIMPLE, CLOSED-FORM AGGREGATE COST FUNCTION. THIS FUNCTION, MOREOVER, HAS THE SAME FORM AS THE COST FUNCTIONS FOR THE ORIGINAL, INDIVIDUAL PRODUCTS. FOR SPECIAL CASES THE ″ APPROXIMATION ″ IS EXACT. THE RESULTS ARE APPLIEDTO A ONE-STAGE, MULTIPERIOD, MULTI-ITEM PRODUCTION SMOOTHING MODEL, AND THEN TO A SIMILAR MODEL OF A TWO-STAGE SYSTEM, YIELDING A REDUCTION IN THE NUMBER OF ITEMS TO ONE OR TO RELATIVELY FEW.