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Price indices for information and communication technology industries: an application to the German PC market


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  • Moch, Dietmar
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    Changing product quality, rapid technological progress, and short product life cycles make it difficult to compute indices that correctly reflect the true price movements of IT products. This paper assesses the differences between traditional and quality adjusted indices by providing results for PC hardware. Transaction price data for the period from 1985 to 1994 are used to construct price indices for personal computers in Germany. The use of hedonic methods allows to correct for quality changes. Quality-adjusted hardware prices decline by 34 percent on average per year according to our hedonic index. The estimation confirms the importance of quality adjustment since the decline of average prices at 7 percent p.a. is substantially lower, thus overestimating computer prices and inflation. When the hedonic index for German computer prices is compared to various indices calculated for the US market it seems that the decline of quality adjusted prices in Germany has been significantly higher than in the US. However if prices are converted to US$ the average decline is about 30 percent which is consistent with results for the US. -- Die Berechnung von Preisindizes zeigt für Deutschland ein ähnliches Bild wie in den USA. Die starken Qualitätsverbesserungen schlagen sich nicht in erhöhten Preisen nieder. Dadurch weisen Preisindizes, die keine Qualitätsverbesserungen berücksichtigen - wie in der amtlichen Statistik üblich - zu hohe Indexzahlen aus. Der Preisrückgang wird unterschätzt, d.h. die Inflation wird zu hoch ausgewiesen. Bei der Analyse der Preisentwicklung für PCs in Deutschland (bezogen auf den Direktmarkt) gingen die nominalen Preise 1985 bis 1994 um ca. 7% jährlich zurück, während der hedonische, qualitätskorrigierte Preisindex einen Rückgang von 34% jährlich auswies. Kontrolliert man für den Wechselkurs zum Dollar (der Dollar ging in dem Zeitraum von über 3 DM bis auf unter 1,50 DM zurück, und die Preise für die Komponenten wie Festplatten, Speicher, Prozessoren, usw., die aus Fernost oder USA importiert werden, werden in Dollar abgerechnet), so bleiben noch ein Rückgang von 1% p.a. des nominalen und ein Rückgang von 30% des hedonischen Indexes. Diese Werte werden durch vergleichbare Forschungsergebnisse aus den USA bestätigt . Der deutliche Unterschied zwischen nominaler und hedonischer Preisentwicklung bei Computern und bei Software läßt vermuten, daß auch bei anderen Gütern, die einen raschen technologischen Fortschritt aufweisen, der Index der amtlichen Statistik die Inflation zu hoch ausweist.

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    Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 01-20.

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    Date of creation: 2001
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    Handle: RePEc:zbw:zewdip:5375

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    1. Harhoff, Dietmar & Moch, Dietmar, 1996. "Price Indexes for PC Database Software and the Value of Code Compatibility," ZEW Discussion Papers 96-17, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    2. Muellbauer, John, 1974. "Household Production Theory, Quality, and the "Hedonic Technique."," American Economic Review, American Economic Association, vol. 64(6), pages 977-94, December.
    3. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May.
    4. Nelson, Randy A & Tanguay, Tim L & Patterson, Christopher D, 1994. "A Quality-Adjusted Price Index for Personal Computers," Journal of Business & Economic Statistics, American Statistical Association, vol. 12(1), pages 23-31, January.
    5. Ernst R. Berndt & Zvi Griliches, 1993. "Price Indexes for Microcomputers: An Exploratory Study," NBER Chapters, in: Price Measurements and Their Uses, pages 63-100 National Bureau of Economic Research, Inc.
    6. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    7. Gordon, Robert J., 1990. "The Measurement of Durable Goods Prices," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226304557.
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    Cited by:
    1. Karl Aiginger & Michael Landesmann, 2002. "Competitive Economic Performance: The European View," WIFO Working Papers 179, WIFO.
    2. Hugo J. Reis & J.M.C. Santos Silva, 2003. "Hedonic Prices Indexes for New Passenger Cars in Portugal (1997- 2001)," Econometrics 0303003, EconWPA.
    3. Georg Erber, 2006. "Benchmarking Efficiency of Telecommunication Industries in the US and Major European Countries: A Stochastic Possibility Frontiers Approach," Discussion Papers of DIW Berlin 621, DIW Berlin, German Institute for Economic Research.
    4. Falk, Martin, 2001. "The impact of office machinery and computer capital on the demand for heterogeneous labor," ZEW Discussion Papers 01-66, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    5. Hannes Leo, 2001. "ICT Investment and Growth of Output and Productivity," WIFO Working Papers 162, WIFO.
    6. Antonopoulos, Christos & Sakellaris, Plutarchos, 2009. "The contribution of Information and Communication Technology investments to Greek economic growth: An analytical growth accounting framework," Information Economics and Policy, Elsevier, vol. 21(3), pages 171-191, August.
    7. Melka, Johanna & Nayman, Laurence, 2005. "L’impact des nouvelles technologies de l’information sur la croissance française, 1980-2001," L'Actualité Economique, Société Canadienne de Science Economique, vol. 81(1), pages 75-110, Mars-Juin.
    8. Johanna Melka & Nanno Mulder & Laurence Nayman & Soledad Zignago, 2003. "Skills, Technology and Growth is ICT the Key to Success ? An Analysis of ICT Impact on French Growth," Working Papers 2003-04, CEPII research center.
    9. Gian Maria Tomat, 2005. "Prices, Product Differentiation And Quality Measurement: A Comparison Between Hedonic And Matched Model Methods," Temi di discussione (Economic working papers) 547, Bank of Italy, Economic Research and International Relations Area.


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