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Does hedonic price indexing change our interpretation of economic history? Evidence from Swedish electrification

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  • HARALD EDQUIST

Abstract

Rapid price decreases for ICT products in the 1990s have been largely attributed to the introduction of hedonic price indexes. Would hedonic price indexing also have had large effects on measured price and productivity during earlier technological breakthroughs? This article investigates the impact of hedonic and matched model methods on historical data for electric motors in Sweden from 1900–35. The results show rapidly decreasing prices in the industry producing electric motors in the 1920s. However, the price decreases of electric motors in the 1920s were not on a par with price decreases for ICT equipment in the 1990s, even if hedonic indexing is used.

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  • Harald Edquist, 2010. "Does hedonic price indexing change our interpretation of economic history? Evidence from Swedish electrification," Economic History Review, Economic History Society, vol. 63(2), pages 500-523, May.
    • Handle: RePEc:bla:ehsrev:v:63:y:2010:i:2:p:500-523
    DOI: 10.1111/j.1468-0289.2009.00504.x
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    2. Kevin Hjortshøj O'Rourke & Nicholas Crafts, 2013. "Twentieth Century Growth," Oxford Economic and Social History Working Papers _117, University of Oxford, Department of Economics.
    3. Crafts, Nicholas & O’Rourke, Kevin Hjortshøj, 2014. "Twentieth Century Growth*This research has received funding from the European Research Council under the European Union’s Seventh Framework Programme (FP7/2007-2013) / ERC grant agreement no. 249546.," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 6, pages 263-346, Elsevier.
    4. Crafts, Nicholas, 2012. "Western Europe's Growth Prospects: an Historical Perspective," CEPR Discussion Papers 8827, C.E.P.R. Discussion Papers.
    5. Nicholas Crafts, 2012. "Economic History Matters," Economic History of Developing Regions, Taylor & Francis Journals, vol. 27(S1), pages 3-15.
    6. Crafts, Nicholas, 2014. "Productivity Growth during the British Industrial Revolution: Revisionism Revisited," CAGE Online Working Paper Series 204, Competitive Advantage in the Global Economy (CAGE).
    7. Svante Prado, 2014. "Yeast or mushrooms? Productivity patterns across Swedish manufacturing industries, 1869–1912," Economic History Review, Economic History Society, vol. 67(2), pages 382-408, May.

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    More about this item

    JEL classification:

    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • N60 - Economic History - - Manufacturing and Construction - - - General, International, or Comparative
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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