bluuebunny/crossref_metadata_2025 huggingface dataset:
INTERTEMPORAL COMPARABILITY OF NATIONAL INCOME IN CZECHOSLOVAKIA
Authors: Kreči Jaroslav
Published: April 2005

The national income and product account (United Nations concept) in current prices itemized by distributive shares and by type of expenditure is given for the period 1929–1937. The national income by industrial origin and the reproducible national wealth are computed for the year 1930. Differences between the U.N. and the material concept are explained by means of the 1939 data.

The national product series in real terms are computed (a) by means of the price deflation of the types of expenditure, and (b) as the physical output of goods and services by industrial origin (since 1926). Major changes In distributive shares are explained with the help of Price‐cost analysis.

The national product in real terms attains the lowest point in 1935 and not in 1933, as the industrial production and foreign trade series indicate. The structure of gross national expenditure reveals the same pattern of shifts, as is well known from other industrially developed countries during the business cycle.

The development of national product by industrial origin, however, reveals some conspicuous singularities. Especially the uninterrupted increase in trade services (in terms of both persons engaged and turnover in constant prices) is an anomaly in the period of 1929–1937.

Further, the Increase of rent (due to the gradual abolition of rent control), contrasting with the general fall of prices, led to a major shift in the distribution of national income during the early thirties. The other remarkable change resulting mainly from the changing price structure was the decrease of the farmers' share in national income.

The production, transportation and distribution series in real terms reveal some time‐lags. These result partly from the shift from the foreign to the home market, partly from the compensatory effects of stock movements, and partly from the delayed adjustment of consumers to declining income.
MÉTHODES DE CALCUL DU REVENU NATIONAL AUX PRIX CONSTANTS UTILISEES PAR LE SERVICE DE LA STATISTIQUE YOUGOSLAVE
Authors: Kitaljević Boško
Published: April 2005

Cet article résume brièvement les méthodes utilisées par le Service de la statistíque yougoslave dans le calcul du revenu national aux prix constants. En ce qui concerne l'industrie, la méthode utilisée consiste à multiplier le revenu net par unité dans l'annCe de base (distribué par type) par les quantités produites dans l'année en cours. Cet article discute également des autres méthodes possibles, et fait ressortir les raisons qui se trouvent à la base des choix effectués.

La partie finale examine la validité des mesures obtenues; elle met en garde contre la tentation de procéder a des interprétations de caractére normatif sur la base de prix déterminés par voie administrative ou sujets a d'autres types de distortions. Des données, classées par industrie et par région, sont fournies pour la periode 1952–1965.
USE OF NATIONAL ACCOUNTS FOR A SHORT‐TERM ECONOMETRIC MODEL: 1954–1966
Authors: Shishido S. , Kohno A. , Nagaya S. , Tanaka S.
Published: April 2005

A quarterly macro‐econometric model of Japan's postwar economy has been constructed for the period 1954–1965 FY on the basis of standardized quarterly national income accounts. The model is designed for facilitating short‐term economic forecasting and formulating adequate fiscal and monetary policy. Longer‐term factors such as labor mobility, technical progress, etc., were also considered in the model.

The model consists of fifty‐three equations related to most of the macroeconomic variables in both money and real terms, and the equations were estimated in principle by the limited information maximum likelihood method. Principal exogenous variables related to policy instruments are government expenditures including transfers, parameters of tax functions, interest rate, and prices and fares controlled by the government, etc. In formulating the model, non‐linear specifications were used whenever found necessary.

Results of our testing on its predictive capability indicated fairly satisfactory performances for our observation period and also for 1966 FY. Multipliers related to fiscal and monetary policy were also obtained, indicating the dynamic characteristics of the Japanese economy, in particular, represented by dynamic business fixed investment, as compared with corresponding multipliers of the U.S. models.

Although the model is exploratory and to serve as a core for a more disaggregated “Master Model,” the usefulness of the model for our purposes and the workability of our quarterly national accounts data for model‐building have been recognized. The quarterly data, however, still remain to be improved especially in regard to consistency between income and expenditure and integration with flow‐of‐funds accounts.
AN EXAMINATION OF THE FEASIBILITY OF USING MONETARY DATA FOR NATIONAL INCOME ESTIMATES
Authors: Duggar Jan Warren
Published: April 2005

In a number of underdeveloped countries today, adequate statistics for estimating national output by traditional national accounting methods are unavailable or unreliable. However, many of these same countries do publish data on monetary variables at an early stage in their development. These data can now be used to estimate national income.

In this study the money supply was defined to include all currency in circulation, private deposits subject to check at all banks and postal systems, all government deposits, and unused overdrafts less float. The national accounts data were taken from United Nations sources and data supplied by various foreign statistical offices. To make the accounts more comparable in terms of coverage and to limit reported income to the monetized sector of the economy, non‐monetary imputations were deleted.

The monetary and national accounts data were combined in a multiple, stepwise regression. National income was used as the dependent variable and money supply and other data were used as the independent variables. The final estimating equations explained about 96 per cent of the variation in income between countries. Other tests were conducted using the currency ratio, transactions velocity, population, and per capita consumption. However, these variables did not augment the explanatory power of the regression equations.

When the equations were used to estimate national income for twenty‐two under‐developed countries, the derived estimates showed a high degree of concordance with reported income where it existed for comparative purposes. The results indicate that monetary data can be used to estimate national income for underdeveloped countries with a relatively high degree of accuracy, between countries, and from year to year within a country.
EDUCATION AND ECONOMIC DEVELOPMENT‐THE CANADIAN CASE*
Authors: Firestone O. J.
Published: April 2005

This study assesses the relationship of education and economic growth, economic development and economic progress in aggregate, in structural and in micro‐economic terms on the basis of one hundred years of Canadian experience. Education is considered as a factor of input. The contribution made by knowledge resulting from additional education expands the capacity to produce, and increases the demand for goods and services and the desire for greater leisure. The dual function of education is stressed: the demand and supply effect. Education is examined both as a cause and a consequence of economic growth, economic development and economic progress, through its contribution to the quality of the labour force, earning capacity, both individual and national, productivity, the rate of economic growth and the character of economic development.

The Canadian experience suggests that educational progress generally occurred in line with economic development during the first eight decades, with the real take‐off in educational advancement only occurring in the last two decades, when the nation reached the stage of technological maturity and high mass‐consumption. Among the reasons for the lower ratio of gross national product devoted to education in the first eight decades were the low priority attached to education, the emphasis on investment in physical capital because of its shorter pay‐off period than investment in human capital, and the heavy reliance on a substantial flow of immigrants who had obtained their education and training abroad. A distinct change occurred, however, in the last two decades, partly as a result of new technological challenges and partly as the result of changes in private and public attitudes, as the recognition of the rewards of education in terms of individual advancement and social progress led to a greater willingness to devote an increasing proportion of the nation's resources to investment in human capital, long pay‐off periods notwithstanding.
NATIONAL PRODUCT AT CONSTANT PRICES IN THE FEDERAL REPUBLIC OF GERMANY
Authors: Bartels Hildegard
Published: April 2005

With few exceptions, only cormmodity flows and values which can be determined by means of commodity flows (flows of goods and services) are calculated in constant prices in the official national accounts of the Federal Republic of Germany. Figures an the industrial origin and the final use of the national product are published, the former according to thirty industries, the latter according to the major types of uses of which in particular private consumption expenditure has been further analysed.

The computations at constant prices are based on market prices and not on factor costs. It is only on this basis that a uniform valuation of the production and the expenditure side can be made since the turnover tax, which is the most important indirect tax, is contained in the elements of final demand in varying shares and cannot be eliminated (the tax is part of the price and has cumulative effect).

The computation at constant prices presupposes a breakdown of the values in current prices according to quantities and prices. This raises a number of problems, e.g. because seller and buyer may consider differing aspects‐production costs, technical attributes, etc., on the one hand, and use etc., on the other hand. In part there exist only vague ideas, or no ideas at all, as to what is to be considered‐from a theoretical point of view‐as quantity and price. In other cases the two values can only with great difficulties, if at all, be quantified, or there exists no market price and only the production costs are available. The author deals in greater detail with differences in quality and new commodities, the determination and treatment of quantities and prices for services, in particular for trade services (services attached to goods), the computation of government services at constant prices considering the development of productivity in public service, the determination of the values calculated as balances, above all the treatment of changes in the terms of trade for net exports of goods and services, the computation of the contributions of industries to the gross domestic product and, finally, the reconciliation of the production and the expenditure side.

In a third section the author deals with index formulae and the base year. In the majority of cases values are deflated; partly, however, they are currently adjusted by means of volume and quantity data. On the production side the two methods are in part combined.

In a concluding section a survey is provided of the computation methods used in the Federal Republic of Germany and on the available material for the computations. Mention is made of depreciation at constant prices.
THE STOCK PROBLEM IN HUNGARY
Authors: Fogaras‐Zala Julia
Published: April 2005

In The Present Paper The Author Reviews The Results Of An Investigation Aimed At Estimating The relative level of stocks in Hungary in terms of international comparisons. Though international comparison was limited by scarcity of data, it has still become evident that stocks as a whole, compared to production and sales, seem to be unnecessarily high. The investigation has been carried out in relation both to the level of stocks and their rate of increase.

The global volume and building of stocks, however, did not give a satisfactory explanation, and the investigation had to be extended to the individual groups of stocks separately. In order to facilitate the comparison, stocks were classified into the following groups: agricultural stocks, goods in process, industrial finished goods and manufactures held by users, and retail stocks. The classification was based on the different function of the individual groups. This classification of stocks could be compared only with the data of the U.S A.

The international comparison revealed that both the volume and the rate of increase of stocks in Hungary is unreasonably high. They are high even if we consider that the growth rate of the economy in Hungary was greater than in any of the countries examined.

The author refers to the fact that the stock problem was one of the starting issues in the economic research process which led to the reform of the Hungarian economic management system introduced on 1st January 1968.
CLASSIFICATION OF SOURCES OF GROWTH
Authors: Denison Edward F.
Published: April 2005

Changes in many output determinants contribute to growth. An analysis of the sources of growth is an allocation of changes in output among these determinants. Total factor input and output per unit of input condense all determinants into two groupings. Misinterpretation of results is common because authors presenting either detailed or summary results often provide no complete or precise description of their classification of determinants, and readers ignore even the information provided. The classification suggested in this paper is detailed enough to bring out points at which description is required but often overlooked. Some effects of alternative estimating procedures on classification are described.

The relative usefulness and practicality of possible alternative classifications also need consideration and discussion. This paper is concerned with general purpose classifications, appropriate for analysis of actual series measuring a country's total output, that are suitable for present use but will also accommodate useful detail that may later become feasible. A desirable classification will so specify determinants that (1) they both unite cause with effect and correspond to the economist's method of analysis so that his set of tools can be brought to bear; (2) they do not contribute to growth if they do not change; and (3) they conform as well as possible to practical possibility of estimation. Among several points considered fundamental are that the complete contributions of advances in knowledge and of resource reallocation each appear as an entity. They should not be dispersed among inputs or other determinants. It is less clear whether economies of scale should be a separate determinant or their contribution be dispersed.
COMBINING INPUTS TO SECURE A MEASURE OF TOTAL FACTOR INPUT*
Authors: Daly Donald J.
Published: April 2005

An underlying theme in this paper is that the differences in approach in this area arise partly from the complexity of the phenomena in the real world being studied, the implications of this interrelated complexity for unbiassed and efficient estimates of the structural relations, and the problems of getting an adequate number of observations of the required form.

Two distinct approaches have been used in the study of marginal and total factor productivity. One approach is to use the factor shares in national income as weights to combine the individual factor inputs to make an index of total factor input, and to use a factor's relative share to measure its marginal contribution. The second approach is to estimate the production relation from the data being used, and derive the marginal contribution of the productive factors to output from the estimated relation. The longest parts of the paper review the procedures followed to cope with the main problems in the real world, and the strengths and limitations in the two approaches. The discussion emphasizes the issues for the economy as a whole, and touches only briefly on the issues in disaggregation.

Three major themes are emphasized in the conclusions to the paper. One is that many of the problems, the differences in view, and the controversies grow out of the range of interrelated issues in practical applications. A second major theme is that most of the attempts to solve particular issues by those using the factor shares approach are rather similar to those followed by researchers estimating the production relations directly. A third theme is to encourage more studies that will look at the interconnections between production relations and income distribution, from the points of view of both economic theory (and its predictions about the relevance to concrete applications) and statistical estimation.
THE TREATMENT OF INTANGIBLE RESOURCES AS CAPITAL
Authors: Kendrick John W.
Published: April 2005

The author describes the results of his current research designed to measure total investment, tangible and intangible, and the derived capital stocks for the U.S., 1929–1966. With respect to total investment, the estimates show a marked increase in its ratio to GNP. All of the increase occurs in the intangible component comprising R & D, education and training, health, and mobility. The increase was concentrated in the government sector, although households increased the proportion of disposable personal income devoted to total investment.

Consistent with the relative investment trends, the stock of intangible capital grew considerably faster than the tangible stock. The growth of total capital stocks was somewhat less than that of GNP, however, in both current and constant prices. Thus, the rate of return on total capital rose somewhat over the period. Average rates of return on human and nonhuman capital were closely similar.

In real terms, the growth of total capital stocks accounted for two‐thirds of the growth in real GNP, 1929–1966. One‐third of the growth is attributed to residual forces, chiefly economies of scale, changes in inherent quality of human and natural resources, changes in values and motivations, and changes in rates of utilization of capacity.

The growth of the ratio of real intangible stocks to real tangible stocks accounted for less than half of the increase in total factor productivity 1929–1966. This is significantly less than the contribution of intangibles as estimated by Denison, and the author adduces several reasons why his estimates may understate the contribution. Nevertheless, it seems that the net effect of the residual forces enumerated above must also have made a substantial contribution to the growth of tangible factor productivity and real GNP over the 37‐year period.
WHAT ACCOUNTS FOR JAPAN'S HIGH RATE OF GROWTH?*
Authors: Kanamori Hisao
Published: April 2005

The purpose of this paper is to investigate the sources of economic growth in Japan and to compare the results with those in the U.S. and Europe as studied by E. F. Denison. The method used by Denison is followed as far as possible. The character of this paper is of fact finding, and the interpretation of results or the originality of methodology is not dealt with here. The results may be summarized as follows.

(1) Japan's growth rate is two times that of Europe and three times that of the United States.

(2) The contributions of labor, capital, and the residual to economic growth are all higher for Japan than for the U.S. or Europe.

(3) Factors which account for the higher contribution of labor to economic growth are (a) the higher rate of increase in employment, (b) less shortening of working hours, and (c) improved age and sex composition.

(4) Factors which account for the higher contribution of capital to economic growth are a higher rate of increase in capital input and the high elasticity of production with respect to capital.

(5) Other notable points include: (a) the contribution of education is lower for Japan; (b) the capital‐labor ratio in Japan increased remarkably; (c) capital's share of national income is higher; and (d) 60% of Japan's economic growth is accounted for by the residual.
MEASUREMENT OF TOTAL FACTOR INPUT, TECHNICAL CHANGE AND OUTPUT BY INDUSTRY IN THE FEDERAL REPUBLIC OF GERMANY 1958–1968
Authors: Krengel Rolf
Published: April 2005

This paper deals with some results of an extended investigation which was carried out by the German Institute of Economic Research, Berlin, and the Ifo‐Institute, Munich, and financed by the Stiftung Volkswagenwerk. For 29 sectors of manufacturing Cobb‐Douglas production functions have been calculated, based on quarterly figures 1958–1968 of value added, input of hours worked, input of utilized capital stock (net of scrappage), and of potential value added, potential labor input and total capital stock. The income distribution is used as production elasticities. For each of the 29 sectors 12 time series of quarterly indices of total factor input and technical change have been computed, using utilized data (variation 1‐6) and capacity data (variation 7‐12). Two different time series of α are used, taking quarterly interpolated data (variation 1, 3, 5, 7, 9, 11) and the geometric mean 1958–1968 (variation 2, 4, 6, 8, 10, 12). Moreover three different parameters of homogeneity are introduced, taking r= 1 (variation 1, 2, 7, 8), r= 1.1 (variation 3, 4, 9, 10) and r= 1.25 (variation 5, 6, 11, 12). Seven of the 29 sectors show a very high sensitivity of the rate of technical change due to the assumed r, six sectors a rather high sensitivity. Ten of the 29 sectors show a rather small sensitivity of technical change due to the assumed r, six sectors a very small or even negative sensitivity, i.e. an increasing r creates an increasing technical change. These results can be explained by taking account of the fact that total factor input in many branches increased very slowly or even decreased (labor input alone decreased in nearly all branches). A hierarchy of technical change has been calculated; this hierarchy is difficult to explain, because fast growing industries as well as industries with a small or a negative growth rate of output rank in both the leading and the last group of technical change. Very high rates of output result in high rates of technical change (chemicals, mineral oil refining, plastics manufactures), but some industries with a rather small growth of output (shipbuilding, fine ceramics, steel drawing, and cold rolling mills) show a high rate of technical change too.
PRODUCTIVITY GROWTH IN THE HUNGARIAN ECONOMY1
Authors: Román Z.
Published: April 2005

This paper analyses productivity growth in the Hungarian economy over the two decades between 1950 and 1970 with the aim of establishing what help can be provided in such analyses by the use of total factor productivity index numbers. After the introductory sections the paper deals first with the rates and factors of Hungarian productivity growth, and then with some methodological lessons of the investigation.
EXCHANGE RATE PROBLEMS IN NATIONAL ACCOUNTING OF DEVELOPING COUNTRIES*
Authors: Gaathon A. L.
Published: April 2005

Developing countries which typically have import surpluses and inflationary pressures because of insufficient savings are prone to use indirect taxes on imports (Tm) and subsidization of exports (Sx) in order to prevent deterioration of the balance of trade. If these substitutes for devaluation are included in the net indirect tax component of product at current market prices (Ym) the import surplus is likely to be understated, and Ym upward biased. This distortion will be avoided if imports and exports are measured at effective exchange rates (ER), that is, at official rates (OR) plus Tm and Sx respectively, and if (Tm ‐ Sx) is deducted from the net indirect tax component of Ym. Only in this manner become imports and exports consistent with the other uses and resources at market prices and can be articulated with them. At base‐year prices the volume index of product at OR diverges from that of ER to the degree that the composition of imports and exports in regard to tax and subsidy rates computed ad valorem significantly changes.

Such a case is similar to that of the price indexes of imports and exports moving in diverging proportions: the trade balance at base‐year prices will differ from that at current prices. The resulting discrepancies in national accounts have led to proposals of deflating, for example, exports by the price index of imports. Suchlike approaches are incompatible with the principle of national accounting that prices are supposed already to measure substitution values. Deflating exports by import prices means reintroducing substitution values, as does, for example, deflation of incomes by a consumer price index. Correspondingly, since the trade balance at ER conceptually expresses the value of imports at domestic market prices as compared to the corresponding domestic market value of exports, and if at ER the trade balance diverges from that at OR, the former balance has an important meaning (as has the trade balance at base‐year prices as compared to that at current prices) and the resulting discrepancy between the two measures should not be removed merely for the sake of accounting smoothness.

In contrast to the market price approach, the measurement of product at base‐year factor cost is indifferent to the measurement of the trade balance at ER and at OR.

It is, therefore, proposed in countries in which part of import taxation and export subsidization substitutes for devaluation, to record imports and exports in the national accounts at effective exchange rates, and to correct the net indirect tax component of product correspondingly. Imports and exports at official exchange rates should be shown within the balance of payments, and the latter separately as a memorandum item.
THE IMPACT OF EDUCATION ON INCOME DISTRIBUTION
Authors: Tinbergen Jan
Published: April 2005

In this paper the author adds some further empirical tests of his theory of income distribution. This theory (cf. this Review, Series 16, Number 3, September 1970, p. 221 ff) sees income distribution as the distribution of prices of production factors, especially labour, of different quality and prices as the effect of demand and supply factors. The quality of labour is represented only by the number of years of schooling. Its supply is described by the actual numbers of people having each of the possible years of schooling; this frequency distribution can be characterized by its average and by some measure of its dispersion or by one of its deciles (in particular the highest) expressed in terms of its median. The demand for the various qualities of labour can be supposed to be reflected by (i) total demand for commodities, but (ii) more accurately by the percentage of third‐level educated people used in and weighted by the size of the four main sectors of production: agriculture, manufacturing, trade and transport, and other services. Extensive material collected and reworked by Professors B. R. Chiswick for the U.S.A. and Canada and T. P. Schultz and L. S. Burns with H. E. Frech III for the Netherlands is used in cross‐section tests to explain variations in income distribution in the states of the U.S.A. and the provinces of Canada and the Netherlands. The results can be found in the tables. While further increase and smaller dispersion in years of schooling, according to some of the findings presented, would only moderately reduce the degree of inequality in the U.S.A. and Canada, more result seems to be possible according to other findings, including those for the Netherlands. In the latter category the second demand index mentioned above has been used. This paper is one of several devoted in various ways to the testing of the same theory.
A SIMPLIFIED INTEGRATED FORM OF SNA AND MPS*
Authors: Choudhury Uma Datta Roy
Published: April 2005

At present two systems of measurement of national product are in practice, one as defined in the UN System of National Accounts (SNA) and the other termed the Material Product System (MPS) or National Balances for the Economy. In the present paper, an expanded system of accounts integrating the national balances within the framework of a simplified SNA has been suggested. The accounts suggested are mainly the two sets of (i) Supply, Disposition and Domestic Production of goods and services and Consumption Expenditure of Budget and Mixed Organisations and the Population, and (ii) Income and Outlay and Capital Formation Accounts.

The system is convenient not only for arriving at estimates by either of the two approaches, but is readily manageable. This set of accounts can, without any effort, be put in the form of a matrix leading to its ultimate integration with either the UN System of National Accounts or a modified system of national balances.

The system gives not only the integrated system of SNA and national balances, but also a coded list of transactors and transactions within the economy. This coded list can be used as the first set of information for the creation of the economic data bank for the Integrated Statistical Information System.
NATIONAL WEALTH ESTIMATION IN SOCIALIST COUNTRIES
Authors: Nesterov L.
Published: April 2005

The CMEA standard of statistical information provides a system of national wealth indicators. The paper deals with certain time series published in these countries and in the CMEA Statistical Yearbook as the components of that system. Special attention is paid to the USSR interbranch balance of 30 types of fixed assets cross‐classified by 105 branches of economy. This balance is analogous to the input‐output table technique in the western literature. On the basis of this balance the Soviet statisticians furnish coefficients of direct and total requirements in fixed assets for each branch. Such coefficients are usually called capital ratios or capital coefficients. In the USSR they are calculated together with the coefficients of direct and total requirements of labour for the same industries, and they supplement input‐output tables. The scheme of the fixed assets balance and the matrix for the calculation of these coefficients are described in the paper together with some numerical illustrations of actual coefficients reached in the calculations.
IMPORT FORECASTS FOR INPUT‐OUTPUT MODELS*
Authors: Sawyer John A.
Published: April 2005

The paper presents forecasting models for (1) the share of competitive imports in the total demand for a commodity group and (2) the level of demand for competitive imports of a commodity group. The two forecasting models are used, respectively, with (1) input‐output models which incorporate market share parameters as one vector of coefficients and (2) input‐output models which assume imports have been determined autonomously. It is shown that these two types of input‐output models can be made workable by prefixing one or other of the import forecasting models to the input‐output model. Tests are made of the forecasting ability of the combined models.
NOTES ON DEVELOPING COUNTRIES AND THEIR STATISTICS
Authors: Jaffe A. J.
Published: April 2005

Statistics for developing countries often are misunderstood and misinterpreted because the published data do not distinguish between the economically modern and the traditional sectors. The purpose of economic development is to move a nation from the traditional, or largely non‐monetary, subsistence agriculture type of life, to the modern or money oriented and technologically developed type. Statistics of national accounts, the economically active (the working force), and other topics often fail to be useful for economic development purposes because they are presented for the totality of the country and do not show the modern‐traditional sectors separately.

In addition, data are often misinterpreted and used incorrectly because the development economists do not understand the nature of the data—how they were collected and what they really signify. This point is illustrated with the economically active statistics. Finally, a plea is made for more statistics and information about families.
INTERNATIONAL PRICE COMPARISONS BASED UPON INCOMPLETE DATA*
Authors: Summers Robert
Published: April 2005

This paper is directed at the following question: given an incomplete set of price data relating to goods or services in some category of output for each of a number of different countries, what arithmetic should be performed on the prices to get a meaningful representation of the relative category price‐levels of the countries? In the course of developing an answer to the question, some broader matters are considered and illuminated. A comparison of category price‐levels for different countries is analogous to a commonly‐encountered problem in many areas, that of ranking ordinally or cardinally in one dimension a group of “entities”—persons, households, firms, industries, etc.—on the basis of sets of measurements associated with the individual entities. It is this point of view which dominates the following presentation.
WEIGHTING OF INDEX NUMBERS IN MULTILATERAL INTERNATIONAL COMPARISONS
Authors: Drechsler László
Published: April 2005

The article reviews the methods used in practice and/or proposed by various authors for compiling indices in multilateral international comparisons. The various procedures are examined in the light of the following requirements: characteristicity (i.e. the weights should be characteristic to the countries which are compared), unbiasedness, circularity, internal consistency and factor relations.

There is no perfect solution since characteristicity and circularity are always and unbiasedness and internal consistency often in conflict with each other. The indices which are best for bilateral purposes are not transitive and the basic problem of multilateral comparisons is to obtain circularity, without losing too much of the characteristicity of the bilateral comparisons. Different compromises between the two requirements are possible and this is first of all what distinguishes the various methods used in practice.

Two main types of solution are applied in the various international comparisons. The first is based on the inter‐spatial Fisher's ideal formula (e.g. the Eltetö–Köves–Szulc method, the van Yzeren method, the “central country” solution); the second type uses some kind of average prices (e.g. the Geary–Khamis method).

In the author's view there is no best method in absolute terms. Every method has some weaknesses and which of these weaknesses is the easiest to accept depends to a large extent on the actual aims of the comparison and on various other circumstances.
ON CONSISTENT INTERGROUP COMPARISONS OF PURCHASING POWER OF MONEY
Authors: Mukherjee M. , Rao D. S. Prasada
Published: April 2005

There is some advantage in comparing price levels using consistent methods because this gives unique results. This paper examines some available methods of consistent comparison, pointing out difficulties associated with heterogeneous data, and suggesting adaptations yielding better comparisons. Next, the problem of non‐availability of price and quantity decomposition is considered. Another problem relating to non‐identical lists of commodities and quality differences is tackled by using linear programming instead of regression methodology, both methods using some transformed variables. The procedure suggested is likely eventually to be useful for comparison of dissimilar countries. Computations on some Indian population groups illustrate the findings.
A COMPARISON OF SOME SHORT‐CUT METHODS OF ESTIMATING REAL PRODUCT PER CAPITA
Authors: Heston Alan
Published: April 2005

Several recent studies of short‐cut estimates comparing real income (on a purchasing power basis) of countries are reviewed, including methods comparing real income based on indicators, like electricity consumption. New estimates are presented for 101 countries which had a tradition of conventional national income estimates in 1965, and for 40 countries without extended national income series. One conclusion from the empircial analysis was that until there exist a large number of countries for which purchasing power estimates of real income are available, it is difficult to discriminate between alternative short‐cut methods using indicators, and difficult to estimate real per capita incomes of low income countries without substantial errors of estimate. The paper advocates more purchasing power estimates, and institutionalizing the collection of international prices of specified items so that abbreviated market baskets can be readily compared across countries.
PRICE, PURCHASING POWER AND REAL PRODUCT COMPARISONS IN LATIN AMERICA
Authors: Salazar‐Carrillo Jorge
Published: April 2005

The paper begins with a discussion of the concepts used and the scope of their application. Then the purchasing power parity rates for LAFTA countries in 1968 are presented and analyzed. With the aid of such rates the real gross domestic products of these countries in 1968 are estimated. Among other conclusions, it is found that these differ quite importantly from GDP calculations using foreign exchange rates, even within the LAFTA area. Finally, the levels of consumer prices in the region in 1968 are compared, and these are contrasted with the results of a similar survey undertaken in 1960.
SOCIAL INDICATORS—SYSTEMS, METHODS AND PROBLEMS
Authors: Moser Sir Claus
Published: April 2005

Professor Moser regards the purpose of social indicators as being to aid the policy maker by summarizing the state and changing conditions of society, pinpointing the outstanding existing and emerging social problems and monitoring the effects of social policies and programmes. Thus social indicators will frequently, though not necessarily, be normative and they will often, though again not necessarily, be concerned with outputs rather than inputs. Although many writers regard social indicators as being combinations of series, the problems of construction are substantial. Central to the idea of a social indicator, however, is that it should represent or summarize a broader concept than itself and that it should belong to a structure or system of series. Although there are no social theories about society in general on which a structure of indicators can at present be based there are a number of middle range theories relating to specific fields or sectors, such as occupational mobility, education, migration, mental health, etc., around which quantitative relationships and models can gradually be be built to give insight into social changes and perhaps eventually into the manipulation of policy instruments for the improvement of social conditions.
A SYSTEM OF SOCIAL MATRICES
Authors: Stone Richard
Published: April 2005

The paper is concerned with a method of organizing and analyzing information relating to human stocks and flows. The kind of statistical reporting system envisaged is of a traditional kind, but extended so as to record year‐to‐year changes of state. Life is divided into a number of sequences, each with its own set of characteristic classifications, to avoid an excessive proliferation of categories and so enable many analyses to be made with the kind of statistics already avilable in a number of countries. The need, for some analytical purposes, to combine classifications from different sequences is fully recognized; and this need indicates a direction in which statistical reporting systems should move in the future.

The main analytical tool is a set of linear difference equations which, under suitable conditions, can be interpreted either in terms of an input‐output system, as in economics, or in terms of an absorbing Markov chain, as in probability theory. A simple regression model is used to link characteristic classifications.

About half the paper is taken up with numerical examples, mainly connected with the British educational system as it was in the mid‐1960's. An application is also given to movements into, through and out of a psychiatric service system in Scotland.
EXPERIENCE IN MEASUREMENT OF WELFARE COMPONENTS AND THEIR REGIONAL IMPLICATIONS
Authors: Blohm Margareta , Ohlsson Ingvar
Published: April 2005

The paper relates the Swedish discussion and criticism of national accounting statistics, especially GNP, as a measure of welfare. It describes some results of recent Swedish attempts to find practicable measures of welfare components, i.e. the investigations of the Low Income Commission and of the Expert Group on Regional Development Research. In both cases the regional aspects of welfare are emphasized in the paper.

The results are presented as a sign of important needs for new methods and new systems of concepts in measuring welfare. The Expert Group has for instance in different ways tried to map and compare the “service structure” of separate parts of Sweden. The Low Income Commission has principally studied the position in Swedish society of low income recipients and has not been working particularly on the illumination of regional differences, but since different types of region are included as a background variable, the investigations also give certain measures of the regional aspects of welfare.

In the last part of the paper some of the risks that seem to be difficult to avoid in trying to use welfare measurements are pointed out.
FILES OF INDIVIDUAL DATA AND THEIR POTENTIALS FOR SOCIAL RESEARCH
Authors: Aukrust Odd , Nordbotten Svein
Published: April 2005

In a statistical file system, data collected from different sources and at different dates are stored at an individual unit level. Thus, they may be linked and used for the preparation of statistics and for analytical purposes as the need arises. The statistical file system will provide a much improved data basis for empirical research in the social services including demography, economics, economic geography, sociology, education, labour, social medicine, criminology and social psychology.
REPLY
Authors: Jaffe A. J.
Published: April 2005

Since Dr. Bartsch has gone only partially into the history of the United Nations definition of employment and unemployment, let me pursue it a bit further. To begin, the ILO is a Member Agency of the UN and thus automatically subsumed under the latter. I am fully aware that the ILO segment of the UN was given the area of labor statistics as its domain, and hence draws up official definitions, etc. (Except for the industrial composition classification of the economically active, which area was assigned to the UN Statistical Office.)
THE USE OF UNIT VALUES TO MEASURE DEVIATIONS OF TRANSACTION PRICES FROM LIST PRICES
Authors: Gordon Robert J.
Published: April 2005

The results reported in the Searle report have stimulated me to carry out an extensive study of unit value indices, based on a much more extensive body of data and much improved procedures as compared to the preliminary evidence contained in my “Measurement Bias in Price Indices for Capital Goods,” published in this journal in June, 1971. Once again, the new study confirms the hypothesis that transaction prices of capital goods exhibit procyclical fluctuations relative to list prices. Machinery prices appear to have been considerably more flexible downward during the period of weak investment demand between 1957 and 1963 than indicated by the Wholesale Price Index (WPI), and more flexible upward during the subsequent expansion during 1963–1969. This brief paper is a summary of the study. A complete and detailed report or results is contained in my forthcoming monograph, Measurement of Durable Goods Prices, to be published by the National Bureau of Economic Research.
HUMAN CAPITAL: DETERIORATION AND NET INVESTMENT
Authors: Moreh J.
Published: April 2005

The current practice in national accounting is to exclude from national product investment in schooling and on‐the‐job training, except for direct costs of schooling which are included in consumption. Foregone earnings, which form the major part of investment in human capital, go unrecorded.

Much is to be gained in consistency and analytical clarity by treating human capital like physical capital in national accounting. Estimating the amount of foregone earnings net of deterioration, that is, net investment, is a step in this direction.

Using the framework of the life‐cycle hypothesis of earnings, and assuming declining‐balance deterioration of human capital, estimates of deterioration rates in respect of American males by race and education level are computed for 1960. Every such d is, however, the minimum consistent with the respective costs and benefits profile. Hence an upper limit d is assumed. The model generates for each costs and benefits profile and in respect of either d, a year‐by‐year series of net investment in human capital. These are used to obtain two estimates (which turn out to be close to each other) of aggregate net investment in American white males in 1960. On the basis of these estimates, aggregate net investment in human capital is found to be about equal to net investment in physical assets (including consumers’durables).

It is also found that the Denison method of estimating the contribution of the increase in human capital to economic growth understates this contribution by a ratio approximately equal to net investment in on‐the‐job training to returns to human capital. This was about 16 percent in 1960.
ON THE APPROPRIATE MODEL FOR ANALYZING INVESTMENT IN HUMAN CAPITAL WHERE THE CAPITAL MARKET IS IMPERFECT
Authors: Gustman Alan L.
Published: April 2005

This paper suggests a modification of the Becker–Chiswick model for analyzing investment in human capital where the capital market is imperfect. The modification essentially involves the addition of a consumption function to the model. As a result it is possible to include the effects of human capital investment on a student's income expectations, on consumption, and thereby on the availability of funds for the student to finance investment in human capital.
INDIAN SAVING BEHAVIOR: A RECONCILIATION OF TIME SERIES AND CROSS SECTION EVIDENCE
Authors: Vakil Firouz
Published: April 2005

Serious doubts have been raised as to the validity of using cross‐sectional estimates of the average propensity to consume over time. These d⊙ubts are based on empirical evidence for the United States presented by Kuznets and Goldsmith. This paper extends these considerations to developing countries by looking at the evidence for India. Simple statistical techniques, including ordinary least squares regression, Chow tests, and t‐tests, are used in the estimation of the consumption functions and the formulation of hypotheses. Both India and the U.S. are seen to exhibit the same characteristic secular constancy in the average propensity to consume. For India the average propensity to consume is about 0.95 and is maintained in the face of no substantial secular increases in per capita income during the period under study (1919–1960).

The same inconsistencies between time series and cross‐section evidence on the average propensity to consume are found to exist for India. The permanent income theory suggested only a partial explanation of these inconsistencies and the reconciliation was achieved by a Duesenberry type explanation based on evidence for a shifting cross section consumption function over time. The date was provided by a set of Family Living Surveys for Industrial Workers: 1926, 1933–1935, 1950–1952, 1958–1959.

Finally it was noted that the cross‐section consumption function in India had shifted both upwards and downwards over the period under study, in contrast to the strict upward shift for the U.S. In an economy such as India's, where secular growth is by no means assured, it is not always likely that consumers can avoid lowering previously achieved consumption standards in the face of cyclical economic conditions.