Indexed Units of Account: Theory and Assessment of Historical Experience

Robert Shiller

No 6356, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: An indexed unit of account is a money analogue, used to express prices; the unit's" purchasing power is defined by an index. Indexed units of account are not true money in that" they are not used as a medium of exchange. The first successful indexed unit of account Unidad de Fomento (UF) has been used in Chile since 1967, and has been copied in Colombia Ecuador, Mexico, and Uruguay. The reasons for creating such units are discussed from the" standpoint of monetary theory. The experience with such units in Chile is discussed. It is argued" that important practical problems in implementing indexation were solved by creating such" indexed units of account. The existing indexed units of accounts may not be ideal for all" purposes, however, and alternative definitions of the units, relating the units to measures of" income, may also be advantageous. The indexed units of account might someday be" monetized,' i.e., institutions such as debit cards may be devised to allow the units to be used for" all transactions, so that the role of conventional money might be reduced to clearing-house" functions only.

JEL-codes: E42 (search for similar items in EconPapers)
Date: 1998-01
Note: ME
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

Published as Chapter 4 in "Indexation, Inflation, and Monetary Policy," edited by Fernando Lefort and Klaus Schmidt-Hebbel, Volume 2 of the series "Banca Central, Análisis y Políticas Económicas" of the Central Bank of Chile, 2002, pp. 105-134

Downloads: (external link)
http://www.nber.org/papers/w6356.pdf (application/pdf)

Related works:
Chapter: Indexed Units of Account: Theory and Assessment of Historical Experience (2002)
Working Paper: Indexed Units of Account: Theory and Assessment of Historical Experience (1998)
Working Paper: Indexed Units of Account: Theory and Assessment of Historical Experience (1998)
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:6356

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w6356

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 ().