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Minding Your Ps and Qs: Going from Micro to Macro in Measuring Prices and Quantities

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  • Gabriel Ehrlich
  • John Haltiwanger
  • Ron Jarmin
  • David Johnson
  • Matthew D. Shapiro

Abstract

Key macro indicators such as output, productivity, and inflation are based on a complex system across multiple statistical agencies using different samples and levels of aggregation. The Census Bureau collects nominal sales, the Bureau of Labor Statistics collects prices, and the Bureau of Economic Analysis constructs nominal and real GDP using these data and other sources. The price and quantity data are integrated at a high level of aggregation. This paper explores alternative methods for reengineering key national output and price indices using item-level data. Such reengineering offers the promise of greatly improved key economic indicators along many dimensions.

Suggested Citation

  • Gabriel Ehrlich & John Haltiwanger & Ron Jarmin & David Johnson & Matthew D. Shapiro, 2019. "Minding Your Ps and Qs: Going from Micro to Macro in Measuring Prices and Quantities," AEA Papers and Proceedings, American Economic Association, vol. 109, pages 438-443, May.
  • Handle: RePEc:aea:apandp:v:109:y:2019:p:438-43
    Note: DOI: 10.1257/pandp.20191004
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    References listed on IDEAS

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    1. C. Lanier Benkard & Patrick Bajari, 2005. "Hedonic Price Indexes With Unobserved Product Characteristics, and Application to Personal Computers," Journal of Business & Economic Statistics, American Statistical Association, vol. 23, pages 61-75, January.
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    6. Gabriel Ehrlich & John C. Haltiwanger & Ron S. Jarmin & David Johnson & Matthew D. Shapiro, 2020. "Reengineering Key National Economic Indicators," NBER Chapters, in: Big Data for Twenty-First-Century Economic Statistics, pages 25-68, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Gabriel Ehrlich & John C. Haltiwanger & Ron S. Jarmin & David Johnson & Matthew D. Shapiro, 2020. "Reengineering Key National Economic Indicators," NBER Chapters, in: Big Data for Twenty-First-Century Economic Statistics, pages 25-68, National Bureau of Economic Research, Inc.
    2. Patterson, David, 2021. "The Money Value Problem: Convertibility & Stable Prices Revisited," Studies in Applied Economics 177, The Johns Hopkins Institute for Applied Economics, Global Health, and the Study of Business Enterprise.

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    More about this item

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)

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