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Estimation of General and Commodity-Specific Inflation Rates Using Linear Time-Varying Constraints

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  • Rao, D.S. Prasada
  • Doran, Howard E.
  • Selvanathan, E.A.

Abstract

In this paper, we consider the problem of estimating general and commodity-specific inflation rates by the stochastic approach considered in Clements and Izan (1987) and Selvanathan (1989). In order to achieve identification of commodity-specific rates, a linear constraint usually is imposed, and to make it operational, the constraint is generally imposed at an average over the time periods in the series. This paper uses recently developed methodology for estimation of econometric models with time-varying constraints (O’Donnel, Rambaldi, and Doran) to relax the constraint imposed at average shares and to derive commodity-specific inflation rates.

Suggested Citation

  • Rao, D.S. Prasada & Doran, Howard E. & Selvanathan, E.A., 2003. "Estimation of General and Commodity-Specific Inflation Rates Using Linear Time-Varying Constraints," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 35(Supplemen), pages 1-8.
    • Handle: RePEc:ags:joaaec:43283
    DOI: 10.22004/ag.econ.43283
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    References listed on IDEAS

    as
    1. Selvanathan, E A, 1989. "A Note on the Stochastic Approach to Index Numbers," Journal of Business & Economic Statistics, American Statistical Association, vol. 7(4), pages 471-474, October.
    2. Clements, Kenneth W & Izan, H Y, 1981. "A Note on Estimating Divisia Index Numbers," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 22(3), pages 745-747, October.
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    Cited by:

    1. Gabriela OPAIT, 2014. "The Architecture of the Statistical Modeling Concerning the Consumer Prices Indexes for Food Goods, Non-Food Goods and Services, in Romania," Economics and Applied Informatics, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, issue 1, pages 89-102.
    2. L.L. Ong & K.W. Clements & H.Y. Izan, 1997. "The World Real Interest Rate: Stochastic index number perspectives," Economics Discussion / Working Papers 97-26, The University of Western Australia, Department of Economics.
    3. Gabriela OPAIT, 2013. "The Trend Model Of The Inflation Rate In Romania," Risk in Contemporary Economy, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, pages 74-79.
    4. Gabriela OPAIT, 2013. "The Architecture of the Territorial Indexes through the Standardisation Method," Economics and Applied Informatics, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, issue 1, pages 89-95.
    5. Gabriela OPAIT, 2013. "Statistical Approaches Concerning the Influences of the Exports and Imports over the Dynamics of the Informational Energy," Economics and Applied Informatics, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, issue 3, pages 89-98.
    6. Gabriela OPAIT, 2013. "The Statistical Modeling Of The Trend Concerning The Arrivals Of The Foreign Visitors In Romania," Risk in Contemporary Economy, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, pages 90-95.

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