Estimating Consumer Price Indices Through Engel Curve and Linear Expenditure System: An Exploratory Note
Material type: TextDescription: 48 - 69 pSubject(s): Online resources: In: MURTHY, E N APPLIED ECONOMICSSummary: This paper proposes a method of estimating spatial bilateral price index numbers from cross-section consumer expenditure data on different items using Engel curve analysis. A simple technique is developed by which it is possible to find a method for estimating a set of consumer price index numbers for a group of consumer expenditure items (both goods and services) for which only expenditure data are available. The main assumption of this technique is that the Linear Expenditure System (LES) is the correct and actual description of the complete demand system of the particular population of which we are interested to find the price index. The usefulness of the procedure is that it overcomes the problem of data inadequacy, a problem that is still prevalent in various databases, especially in the developing countries and it is easy to implement. To illustrate the method, ICRISAT VDSA database (which is in the public domain) of consumer expenditure is used and the spatial consumer price index number for non-food group for four villages of Andhra Pradesh is calculated for four years with one particular village taken as the base. The main limitation of the method is that violation of LES assumption can lead to inconsistent results.Item type | Current library | Call number | Vol info | Status | Notes | Date due | Barcode | Item holds | |
---|---|---|---|---|---|---|---|---|---|
Journal Article | Main Library | Vol 16, No 3/ 5557553JA4 (Browse shelf(Opens below)) | Available | 5557553JA4 | |||||
Journals and Periodicals | Main Library On Display | JOURNAL/ECO/ Vol 16, No 3 (Browse shelf(Opens below)) | Vol 16, No 3 (01/07/2017) | Not for loan | July -2017 ( Vol 16, No 3) | 5557553 |
Browsing Main Library shelves Close shelf browser (Hides shelf browser)
No cover image available | No cover image available | No cover image available | No cover image available | No cover image available | No cover image available | No cover image available | ||
Vol 16, No 3/ 5557553JA1 An Empirical Analysis of the Relationship Between FPI and Nifty Returns | Vol 16, No 3/ 5557553JA2 Macroeconomic Regimes and Foreign Exchange Rate Volatility in India | Vol 16, No 3/ 5557553JA3 Efficiency of Futures Market in India: Evidence from Agricultural Commodities | Vol 16, No 3/ 5557553JA4 Estimating Consumer Price Indices Through Engel Curve and Linear Expenditure System: An Exploratory Note | Vol 16, No 3/ 5557763JA1 Risk Management in Indian Banks: Primary Data Analysis. | Vol 16, No 3/ 5557763JA2 Income Diversification: A Study on Indian Banking Industry. | Vol 16, No 3/ 5557763JA3 Factors Affecting the Financial Inclusion of SHG Members: An Empirical Study in Tripura |
This paper proposes a method of estimating spatial bilateral price index numbers from cross-section consumer expenditure data on different items using Engel curve analysis. A simple technique is developed by which it is possible to find a method for estimating a set of consumer price index numbers for a group of consumer expenditure items (both goods and services) for which only expenditure data are available. The main assumption of this technique is that the Linear Expenditure System (LES) is the correct and actual description of the complete demand system of the particular population of which we are interested to find the price index. The usefulness of the procedure is that it overcomes the problem of data inadequacy, a problem that is still prevalent in various databases, especially in the developing countries and it is easy to implement. To illustrate the method, ICRISAT VDSA database (which is in the public domain) of consumer expenditure is used and the spatial consumer price index number for non-food group for four villages of Andhra Pradesh is calculated for four years with one particular village taken as the base. The main limitation of the method is that violation of LES assumption can lead to inconsistent results.
There are no comments on this title.