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An alternative decomposition of the Fisher index

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  • Hallerbach, Winfried G.

Abstract

Aside from the aggregated information provided by price and quantity indexes, there is growing interest in index decompositions that reveal the contribution of each index component to overall index change. In this paper, we derive a “natural” decomposition of the Fisher price index that is directly implied by its linear homogeneity in price relatives. The proposed “Euler” weights not only indicate the total contribution of each component to total index change but also reveal which component had the highest or lowest marginal impact. Our results can readily be generalized to any index that satisfies the linear homogeneity property.
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  • Hallerbach, Winfried G., 2005. "An alternative decomposition of the Fisher index," Economics Letters, Elsevier, vol. 86(2), pages 147-152, February.
    • Handle: RePEc:eee:ecolet:v:86:y:2005:i:2:p:147-152
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    1. Balk, Bert M., 2004. "Decompositions of Fisher indexes," Economics Letters, Elsevier, vol. 82(1), pages 107-113, January.
    2. Dumagan, Jesus C., 2002. "Comparing the superlative Tornqvist and Fisher ideal indexes," Economics Letters, Elsevier, vol. 76(2), pages 251-258, July.
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    Cited by:

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    2. Xiao, Hao & Sun, Ke-Juan & Bi, Hui-Min & Meng, Bo, 2021. "Attribution of changes in an intensity index," Energy, Elsevier, vol. 216(C).
    3. Su, Bin & Ang, B.W., 2014. "Attribution of changes in the generalized Fisher index with application to embodied emission studies," Energy, Elsevier, vol. 69(C), pages 778-786.
    4. Daniel Bunting & Kevin J. Fox, 2014. "The Impact of Quarantine Policies on the Quality of Imports," Discussion Papers 2014-01, School of Economics, The University of New South Wales.

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    More about this item

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • G3 - Financial Economics - - Corporate Finance and Governance
    • G39 - Financial Economics - - Corporate Finance and Governance - - - Other
    • M - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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