Comments on Diewert (2026): On the Theory and Practice of Proper Indexes

C.J. O’Donnell ()
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C.J. O’Donnell: School of Economics and Centre for Efficiency and Productivity Analysis (CEPA) at The University of Queensland, Australia

No WP022026, CEPA Working Papers Series from University of Queensland, School of Economics

Abstract: This paper comments on Diewert’s discussion of proper quantity indexes. Sev-eral aspects of the theory and interpretation of these indexes are clarified, including the role of production-theoretic assumptions in generating quantity and price in-dexes that satisfy product rules, the interpretation of alternative proper index con-structions, and the ability of proper indexes to preserve historical quantity compar-isons when the representation or scope of a dataset changes. A robustness measure based on quantity data alone is proposed for assessing the sensitivity of quantity comparisons to the choice of proper index. The paper shows that Diewert’s SPQ index does not satisfy the weak monotonicity axiom and therefore is not proper in the sense defined by O’Donnell (2016).

Keywords: measurement theory; multilateral comparisons; multitemporal comparisons. (search for similar items in EconPapers)
JEL-codes: C43 D24 (search for similar items in EconPapers)
Date: 2026-06
New Economics Papers: this item is included in nep-eff
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Persistent link: https://EconPapers.repec.org/RePEc:qld:uqcepa:199

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