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A guide to the use of chain aggregated NIPA data

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  • Karl Whelan

Abstract

In 1996, the U.S. Department of Commerce began using a new method to construct all aggregate "real" series in the National Income and Product Accounts (NIPA). This method employs the so-called "ideal chain index" pioneered by Irving Fisher. The new methodology has some extremely important implications that are unfamiliar to many practicing empirical economists; as a result, mistaken calculations with NIPA data have become very common. This paper explains the motivation for the switch to chain aggregation and then illustrates the usage of chain-aggregated data with three topical examples, each relating to a different aspect of how information technologies are changing the economy.

Suggested Citation

  • Karl Whelan, 2000. "A guide to the use of chain aggregated NIPA data," Open Access publications 10197/253, School of Economics, University College Dublin.
  • Handle: RePEc:ucn:oapubs:10197/253
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    File URL: http://hdl.handle.net/10197/253
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    References listed on IDEAS

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    1. Stephen D. Oliner & Daniel E. Sichel, 2000. "The Resurgence of Growth in the Late 1990s: Is Information Technology the Story?," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 3-22, Fall.
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    4. Karl Whelan, 2002. "Computers, Obsolescence, And Productivity," The Review of Economics and Statistics, MIT Press, vol. 84(3), pages 445-461, August.
    5. Dale W. Jorgenson & Kevin J. Stiroh, 2000. "Raising the Speed Limit: U.S. Economic Growth in the Information Age," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 31(1), pages 125-236.
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    7. Michael J. Boskin, 1998. "Consumer Prices, the Consumer Price Index, and the Cost of Living," Journal of Economic Perspectives, American Economic Association, vol. 12(1), pages 3-26, Winter.
    8. Zvi Griliches, 1961. "Hedonic Price Indexes for Automobiles: An Econometric of Quality Change," NBER Chapters, in: The Price Statistics of the Federal Goverment, pages 173-196, National Bureau of Economic Research, Inc.
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    More about this item

    Keywords

    NIPA Data; Chain aggregation; Information technologies; Information technology--United States; National income--Statistical methods; Chain indexing--United States;
    All these keywords.

    JEL classification:

    • E0 - Macroeconomics and Monetary Economics - - General
    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation

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