An Alternative Decomposition Of The Fisher Index
AbstractAside from the aggregated information provided by price and quantity indexes, there is growinginterest in index decompositions that reveal the contribution of each index component to overallindex change. In this paper, we derive a â€œnaturalâ€ decomposition of the Fisher price index that isdirectly implied by its linear homogeneity in price relatives. The proposed â€œEulerâ€ weights notonly indicate the total contribution of each component to total index change but also revealwhich component had the highest or lowest marginal impact. Our results can readily begeneralized to any index that satisfies the linear homogeneity property.
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Bibliographic InfoPaper provided by Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam. in its series Research Paper with number ERS-2004-022-F&A.
Date of creation: 20 Feb 2004
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besliskunde; Fisher index; decomposition; linear homogeneity;
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- Dumagan, Jesus C., 2002. "Comparing the superlative Tornqvist and Fisher ideal indexes," Economics Letters, Elsevier, vol. 76(2), pages 251-258, July.
- Balk, Bert M., 2004. "Decompositions of Fisher indexes," Economics Letters, Elsevier, vol. 82(1), pages 107-113, January.
- Choi, Ki-Hong & Ang, B.W., 2012. "Attribution of changes in Divisia real energy intensity index — An extension to index decomposition analysis," Energy Economics, Elsevier, vol. 34(1), pages 171-176.
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