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Price-Level Computation: Illustrations

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  • Sydney N. Afriat
  • Carlo Milana

Abstract

It has been submitted that, for the very large number of different traditional type formulae to determine price indices associated with a pair of periods, which are joined with the longstanding question of which one to choose, they should all be abandoned. For the method proposed instead, price levels associated with periods are first all computed together, subject to a consistency of the data, and then price indices that are true taken together are determined from their ratios. An approximation method can apply in the case of inconsistency. Here are illustrations of the method.

Suggested Citation

  • Sydney N. Afriat & Carlo Milana, 2007. "Price-Level Computation: Illustrations," Department of Economics University of Siena 506, Department of Economics, University of Siena.
    • Handle: RePEc:usi:wpaper:506
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    File URL: http://repec.deps.unisi.it/quaderni/506.pdf
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    References listed on IDEAS

    as
    1. Sydney Afriat & Carlo Milana, 2007. "The Super Price Index: Irving Fisher, and after," Department of Economics University of Siena 492, Department of Economics, University of Siena.
    2. Stone,Richard, 2013. "The Role of Measurement in Economics," Cambridge Books, Cambridge University Press, number 9781107673861, October.
    3. Deaton,Angus & Muellbauer,John, 1980. "Economics and Consumer Behavior," Cambridge Books, Cambridge University Press, number 9780521296762, October.
    4. Dowrick, Steve & Quiggin, John, 1994. "International Comparisons of Living Standards and Tastes: A Revealed-Preference Analysis," American Economic Review, American Economic Association, vol. 84(1), pages 332-341, March.
    5. Sydney Afriat & Carlo Milana, 2007. "The Price-Level Computation Method," Department of Economics University of Siena 499, Department of Economics, University of Siena.
    6. Fisher,Franklin M. & Shell,Karl, 1998. "Economic Analysis of Production Price Indexes," Cambridge Books, Cambridge University Press, number 9780521556231, October.
    7. Samuelson, Paul A & Swamy, S, 1974. "Invariant Economic Index Numbers and Canonical Duality: Survey and Synthesis," American Economic Review, American Economic Association, vol. 64(4), pages 566-593, September.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    index-number problem; inflation; non-parametric; price index; price level; revealed preference.;
    All these keywords.

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

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