Simplistic universal coding

A conceptually simple coding method may be described as follows. The source sequence is parsed into fixed-length blocks and a list of these blocks is placed in a dictionary. In the lossless case, the dictionary is transmitted and each successive block is encoded by giving its dictionary location. In the lossy case, the smallest collection of blocks such that every member of the dictionary is within distortion δ of the collection is determined, this codebook is transmitted, and each successive block is encoded by giving the location of a member of the code within δ of it. We show that by optimizing on the block length, this method is universal, that is, for any ergodic process it achieves entropy in the limit in the lossless case and the rate-distortion function R(δ) in the lossy case