Multilateral index number systems for international price comparisons: properties, existence and uniqueness

DOI10.1016/J.JMATECO.2019.02.004MaRDI QIDQ2425189zbMATH OpenOpenAlexFDO

Authors Gholamreza Hajargasht, D. S. Prasada Rao

Publication date 26 June 2019

Published in Journal of Mathematical Economics (Search for Journal in Brave)

Full work available at URL https://arxiv.org/abs/1811.04197

zbMATH Keywords

connected graphsDAD problemgeneralized meaninternational pricesnonlinear Perron-Frobenius problempurchasing power parities

Mathematics Subject Classification ID

Microeconomic theory (price theory and economic markets) (91B24) Statistical methods; economic indices and measures (91B82)

Abstract: Over the past five decades a number of multilateral index number systems have been proposed for spatial and cross-country price comparisons. These multilateral indexes are usually expressed as solutions to systems of linear or nonlinear equations. In this paper, we provide general theorems that can be used to establish necessary and sufficient conditions for the existence and uniqueness of the Geary-Khamis, IDB, Neary and Rao indexes as well as potential new systems including two generalized systems of index numbers. One of our main results is that the necessary and sufficient conditions for existence and uniqueness of solutions can often be stated in terms of graph-theoretic concepts and a verifiable condition based on observed quantities of commodities.

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Cites work

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(9)

• The fixed basket multilateral Walsh index for international price and real expenditure comparisons
• Measuring spatial price differentials at the basic heading level: a comparison of stochastic index number methods
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• On the multilateral index number system based on the factorial approach
• On the Factorial Approach Multilateral Index Number System Satisfying base Invariance and Consistency
• scientific article; zbMATH DE number 1264884 (Why is no real title available?)
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