Inconsistencies in Cross-Country Price Comparisons over Time: Patterns and Facts

Robert Inklaar, Ryan Marapin (), Pieter Woltjer () and Marcel Timmer
Additional contact information
Ryan Marapin: University of Groningen
Pieter Woltjer: University of Groningen

Chapter Chapter 13 in Advances in Economic Measurement, 2022, pp 633-663 from Springer

Abstract: Abstract Purchasing power parities (PPPs) aim to measure relative price levels across countries, like inflation aims to measure relative price levels over time. Ideally, the change in PPPs over time should be consistent with relative inflation, but in practice inconsistencies tend to be substantial, which leads to uncertainty about the relative size of economies across countries. We look for patterns in the PPP data to better understand when and where inconsistency is a more serious problem. We find smaller inconsistencies between more recent PPP comparisons, for countries more similar in terms of income levels and expenditure patterns, but larger inconsistencies for consumption products where measurement challenges are larger. Inconsistencies that distort the international income distribution are uncommon. More frequent PPP surveys are unlikely to decrease inconsistency.

Keywords: Price measurement; Purchasing power parities (PPPs); International income differences (search for similar items in EconPapers)
Date: 2022
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-981-19-2023-3_13

Ordering information: This item can be ordered from
http://www.springer.com/9789811920233

DOI: 10.1007/978-981-19-2023-3_13

Access Statistics for this chapter

More chapters in Springer Books from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().