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Microeconomic Foundations for the Theory of International Comparisons

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Abstract

The paper establishes a basis in economic theory for solving the problem of how to make comparisons of aggregate quantities and price levels across two or more geographic regions. To this end, two new classes of relative purchasing power measures are set out and the dual relationships between them are explored.

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Bibliographic Info

Paper provided by Carleton University, Department of Economics in its series Carleton Economic Papers with number 96-01.

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Length: 29 pages
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Publication status: Published: – revised version in Journal of Economic Theory, Vol. 101, No. 2 (December 2001), pp. 585–605
Handle: RePEc:car:carecp:96-01

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Keywords: index numbers; economic approaches to index number theory; multilateral comparisons; puchasing power parities;

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  1. Pollak, Robert A, 1980. "Group Cost-of-Living Indexes," American Economic Review, American Economic Association, vol. 70(2), pages 273-78, May.
  2. Fisher, Franklin M & Griliches, Zvi, 1995. "Aggregate Price Indices, New Goods, and Generics," The Quarterly Journal of Economics, MIT Press, vol. 110(1), pages 229-44, February.
  3. Bela Balassa, 1964. "The Purchasing-Power Parity Doctrine: A Reappraisal," Journal of Political Economy, University of Chicago Press, vol. 72, pages 584.
  4. Diewert, W. E., 1976. "Exact and superlative index numbers," Journal of Econometrics, Elsevier, vol. 4(2), pages 115-145, May.
  5. 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 566-93, September.
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