IDEAS home Printed from https://ideas.repec.org/a/fip/fedfer/y1992p3-13n1.html
   My bibliography  Save this article

Index numbers and the measurement of real GDP

Author

Listed:
  • Brian Motley

Abstract

The measures of real GDP and inflation are aggregates of many individual prices and quantities. These variables are measured using fixed-weight indexes, which can give a misleading impression of price and output changes in a particular year if the structures of output and relative prices are different from those in the base year. This measurement problem adds to the uncertainties facing policymakers. ; These ambiguities result from the definitions of output and inflation in use. This article describes alternative measures of growth and inflation that have a stronger theoretical basis and avoid these ambiguities. Operational versions of these measures will be introduced by the Bureau of Economic Analysis in 1992. These new measures will remove one source of uncertainty facing policymakers.

Suggested Citation

  • Brian Motley, 1992. "Index numbers and the measurement of real GDP," Economic Review, Federal Reserve Bank of San Francisco, pages 3-13.
  • Handle: RePEc:fip:fedfer:y:1992:p:3-13:n:1
    as

    Download full text from publisher

    File URL: http://www.frbsf.org/publications/economics/review/1992/92-1_3-13.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. James R. Booth & Dennis T. Officer, 1985. "Expectations, Interest Rates, And Commercial Bank Stocks," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 8(1), pages 51-58, March.
    2. Merton, Robert C, 1973. "An Intertemporal Capital Asset Pricing Model," Econometrica, Econometric Society, vol. 41(5), pages 867-887, September.
    3. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-838, May.
    4. William F. Sharpe, 1964. "Capital Asset Prices: A Theory Of Market Equilibrium Under Conditions Of Risk," Journal of Finance, American Finance Association, vol. 19(3), pages 425-442, September.
    5. Martin, John D. & Keown, Arthur J., 1977. "Interest Rate Sensitivity and Portfolio Risk," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 12(02), pages 181-195, June.
    6. Lynge, Morgan J. & Zumwalt, J. Kenton, 1980. "An Empirical Study of the Interest Rate Sensitivity of Commercial Bank Returns: A Multi-Index Approach," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 15(03), pages 731-742, September.
    7. Edward J. Kane & Haluk Unal, 1988. "Change in Market Assessments of Deposit-Institution Riskiness," NBER Working Papers 2530, National Bureau of Economic Research, Inc.
    8. Sweeney, Richard J & Warga, Arthur D, 1986. " The Pricing of Interest-Rate Risk: Evidence from the Stock Market," Journal of Finance, American Finance Association, vol. 41(2), pages 393-410, June.
    9. Don M. Chance & William R. Lane, 1980. "A Re-Examination Of Interest Rate Sensitivity In The Common Stocks Of Financial Institutions," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 3(1), pages 49-55, March.
    10. Jonathan A. Neuberger, 1991. "Risk and return in banking: evidence from bank stock returns," Economic Review, Federal Reserve Bank of San Francisco, issue Fall, pages 18-30.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Robert Ingenito & Bharat Trehan, 1996. "Using monthly data to predict quarterly output," Economic Review, Federal Reserve Bank of San Francisco, pages 3-11.
    2. Charles Steindel, 1999. "The impact of reduced inflation estimates on real output and productivity growth," Current Issues in Economics and Finance, Federal Reserve Bank of New York, vol. 5(Jun).
    3. Charles Steindel, 1997. "Measuring economic activity and economic welfare: what are we missing?," Research Paper 9732, Federal Reserve Bank of New York.

    More about this item

    Keywords

    Gross domestic product;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:fedfer:y:1992:p:3-13:n:1. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Federal Reserve Bank of San Francisco Research Library). General contact details of provider: http://edirc.repec.org/data/frbsfus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.