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An estimation of CPI biases in Argentina 1985–2005 and its implications on real income growth and income distribution

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  • Pablo Gluzmann

    (FCE-UNLP
    Consejo Nacional de Investigaciones Científicas y Técnicas, CONICET)

  • Federico Sturzenegger

    (Universidad Torcuato Di-Tella, UTDT
    Banco Central de la República Argentina, BCRA)

Abstract

We use the shifts in Engel curves calculated from household surveys to estimate CPI biases in Argentina between 1985 and 2005. We find that real earning levels increased during this period between 4.3 and 5.7% faster per year than previously estimated. More surprisingly, relative to conventional wisdom, that income distribution has improved throughout this period.

Suggested Citation

  • Pablo Gluzmann & Federico Sturzenegger, 2018. "An estimation of CPI biases in Argentina 1985–2005 and its implications on real income growth and income distribution," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 27(1), pages 1-50, December.
    • Handle: RePEc:spr:laecrv:v:27:y:2018:i:1:d:10.1007_s40503-017-0049-2
    DOI: 10.1007/s40503-017-0049-2
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    References listed on IDEAS

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    1. Altimir, Oscar & Beccaría, Luis Alberto & González Rozada, Martín, 2002. "La distribución del ingreso en Argentina, 1974-2000," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
    2. Yatchew, A., 1997. "An elementary estimator of the partial linear model," Economics Letters, Elsevier, vol. 57(2), pages 135-143, December.
    3. Filho, Irineu de Carvalho & Chamon, Marcos, 2012. "The myth of post-reform income stagnation: Evidence from Brazil and Mexico," Journal of Development Economics, Elsevier, vol. 97(2), pages 368-386.
    4. Mr. Irineu E de Carvalho Filho & Mr. Marcos d Chamon, 2006. "The Myth of Post-Reform Income Stagnation in Brazil," IMF Working Papers 2006/275, International Monetary Fund.
    5. Bruce W. Hamilton, 2001. "Using Engel's Law to Estimate CPI Bias," American Economic Review, American Economic Association, vol. 91(3), pages 619-630, June.
    6. Diewert, W. Erwin & Greenlees, John & Hulten, Charles R. (ed.), 2010. "Price Index Concepts and Measurement," National Bureau of Economic Research Books, University of Chicago Press, number 9780226148557, December.
    7. Dora L. Costa, 2001. "Estimating Real Income in the United States from 1888 to 1994: Correcting CPI Bias Using Engel Curves," Journal of Political Economy, University of Chicago Press, vol. 109(6), pages 1288-1310, December.
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    Cited by:

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    2. Chunyun Wang & Xiaoxi Yu & Jiang Zhao, 2022. "Identifying the Real Income Disparity in Prefecture-Level Cities in China: Measurement of Subnational Purchasing Power Parity Based on the Stochastic Approach," Sustainability, MDPI, vol. 14(16), pages 1-24, August.

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    More about this item

    Keywords

    Argentina; GDP growth; Engel Curve; CPI Bias;
    All these keywords.

    JEL classification:

    • N1 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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