On Consistent Intergroup Comparisons Of Purchasing Power Of Money

There is some advantage in comparing price levels using consistent methods because this gives unique results. This paper examines some available methods of consistent comparison, pointing out difficulties associated with heterogeneous data, and suggesting adaptations yielding better comparisons. Next, the problem of non‐availability of price and quantity decomposition is considered. Another problem relating to non‐identical lists of commodities and quality differences is tackled by using linear programming instead of regression methodology, both methods using some transformed variables. The procedure suggested is likely eventually to be useful for comparison of dissimilar countries. Computations on some Indian population groups illustrate the findings.