Errors in Output Deflators Revisited: Unit Values and the PPI

39 Pages Posted: 22 Apr 2004

Date Written: December 1991

Abstract

Extending a methodology developed by Lichtenberg and Griliches (1989), we examine the extent of measurement error in two independent indicators of price change: the producer price index (PPI) and the U.S. Census Bureau's unit value relative (UVR). Estimation of factor analytic models is improved by the availability of more accurate and comprehensive proxies for price and quality change within industries and a more complete specification of the econometric model. We find that the UVR is a "noisier measure of price change than the PPI and that the PPI adjusts for approximately 57% of product quality change.

Suggested Citation

Siegel, Donald S., Errors in Output Deflators Revisited: Unit Values and the PPI (December 1991). NBER Working Paper No. w3935, Available at SSRN: https://ssrn.com/abstract=227365

Donald S. Siegel (Contact Author)

Arizona State University ( email )

411 North Central
Phoenix, AZ 85004
United States
6024961101 (Phone)

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
26
Abstract Views
560
PlumX Metrics