Should Exact Index Numbers Have Standard Errors? Theory and Application to Asian Growth

Robert Feenstra and Marshall B. Reinsdorf

No 10197, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: In this paper we derive the standard error of a price index when both prices and tastes or technology are treated as stochastic. Changing tastes or technology are a reason for the weights in the price index to be treated as stochastic, which can interact with the stochastic prices themselves. We derive results for the constant elasticity of substitution expenditure function (with Sato-Vartia price index), and also the translog function (with Törnqvist price index), which proves to be more general and easier to implement. In our application to Asian growth, we construct standard errors on the total factor productivity (TFP) estimates of Hsieh (2002) for Singapore. We find that TFP growth is insignificantly different from zero in any year, but cumulative TFP over fifteen years is indeed positive.

JEL-codes: C43 O53 (search for similar items in EconPapers)
Date: 2004-01
New Economics Papers: this item is included in nep-dev, nep-ecm and nep-rmg
Note: ITI
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published as Should Exact Index Numbers Have Standard Errors? Theory and Application to Asian Growth , Robert C. Feenstra, Marshall B. Reinsdorf. in Hard-to-Measure Goods and Services: Essays in Honor of Zvi Griliches , Berndt and Hulten. 2007

Downloads: (external link)
http://www.nber.org/papers/w10197.pdf (application/pdf)

Related works:
Chapter: Should Exact Index Numbers Have Standard Errors? Theory and Application to Asian Growth (2007)
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:nbr:nberwo:10197

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w10197

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().