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Analysing the effects of price changes on the cost of living of consumers using true indices

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  • Jose Alberto Molina

Abstract

In this paper we analyse the effects of price changes on consumers' cost of living, using true indices for Germany, France, the UK, Spain and Sweden. We define these indices for a PIGLOG cost function and a dynamic specification of the LAIDS allows us to estimate them using aggregated time-series from 1964 to 1993. The calculated index numbers show that: (i) Spain presents the highest values for all groups, whereas the lowest appear in Germany and the UK, (ii) the highest values were in both oil crisis years, 1973 and 1979, whereas the lowest were generally in 1966 and in 1993, and (iii) the mean values reveal that Spain and France display the highest true cost-of-living indices, whereas Germany and the UK show the lowest.

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  • Jose Alberto Molina, 1998. "Analysing the effects of price changes on the cost of living of consumers using true indices," Applied Economics Letters, Taylor & Francis Journals, vol. 5(10), pages 639-644.
    • Handle: RePEc:taf:apeclt:v:5:y:1998:i:10:p:639-644
    DOI: 10.1080/135048598354320
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    1. D. G. Tipping, 1970. "Price Changes and Income Distribution," Journal of the Royal Statistical Society Series C, Royal Statistical Society, vol. 19(1), pages 1-17, March.
    2. Blanciforti, Laura & Green, Richard, 1983. "An Almost Ideal Demand System Incorporating Habits: An Analysis of Expenditures on Food and Aggregate Commodity Groups," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 511-515, August.
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    1. Shaikh Hamid & Tej Dhakar, 2008. "The behaviour of the US consumer price index 1913-2003: a study of seasonality in the monthly US CPI," Applied Economics, Taylor & Francis Journals, vol. 40(13), pages 1637-1650.
    2. Alcay, Alejandro & Escudero, Carlos, 2019. "Efectos de la renta y los precios en la demanda de alimentos: un análisis para el caso español 1980-2015 [Efects of income and prices in food demand: an analysis for the Spanish case 1980-2015]," MPRA Paper 92698, University Library of Munich, Germany.
    3. Elena Lasarte Navamuel & Dusan Paredes & Esteban Fernández Vázquez, 2012. "A true cost of living index for Spain using a microeconomic approach and censored data," Documentos de Trabajo en Economia y Ciencia Regional 26, Universidad Catolica del Norte, Chile, Department of Economics, revised Aug 2012.
    4. Chomali, Laura, 2024. "Consumo de Aliños procesados en Europa: Evidencia con datos alimentarios de EFSA [Consumption of Processed Seasonings in Europe: Evidence from EFSA Food Data]," MPRA Paper 121201, University Library of Munich, Germany.
    5. García, Lucia & Velilla, Jorge, 2018. "Estimación del Modelo de Demanda de Rotterdam para España: evolución de las elasticidades [Estimation of the Rotterdam Model in Spain: the Evolution of Elasticities]," MPRA Paper 88785, University Library of Munich, Germany.
    6. Mora Gómez, Manuel & Mompel Lancina, David, 2019. "Cultura, educación y ocio en España: Estimaciones del Sistema de Demanda Casi Ideal y del Modelo de Rotterdam [Culture, education and laisure in Spain: Estimation of the Ideal demand system and Rot," MPRA Paper 94477, University Library of Munich, Germany.
    7. Perchín Milián, Celia & Cañoto Martínez, Miguel, 2019. "Gastos Médicos en España: Estimaciones del Sistema de Demanda Casi Ideal y del Modelo de Rotterdam [Medical Expenses in Spain: Estimations of the Almost Ideal Demand System and of the Rotterdam Mod," MPRA Paper 92400, University Library of Munich, Germany.
    8. García, Lucia, 2018. "Demand behaviour in Spain during the last three decades: What is the ideal microeconomic model to represent consumer preferences?," MPRA Paper 87937, University Library of Munich, Germany.
    9. Magaña, Diego & Muñoz, Katherine, 2019. "¿Cuál es el modelo microeconómico ideal para representar las preferencias de los consumidores españoles en el periodo 1980-2015?: El caso de muebles, mobiliario y equipamiento [Which is the ideal m," MPRA Paper 94604, University Library of Munich, Germany.
    10. Miranda-Buetas, Sara & Gracia-Raluy, Elisa, 2019. "Análisis de los Patrones de Demanda en el Sector Textil Español [Demand Analysis of Clothing Sector in Spain]," MPRA Paper 92430, University Library of Munich, Germany.
    11. Baigorri, Bárbara & Ledesma, Ana, 2019. "Rentas de vivienda y suministros en el hogar: Selección del modelo microeconómico ideal para representar las preferencias del consumidor [Household income and supplies in the home: Selection of the," MPRA Paper 93265, University Library of Munich, Germany.

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