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# g) The Adequacy of the Sample

Our sample size (39 per cent of Mexican, 33 per cent of Brazilian and 20 per cent of US value added) was certainly big enough to illustrate most of the methodological problems one is likely to meet in this kind of study and to help elaborate pragmatic solutions to them. Except as noted under h) below, the only failure in this respect was the problem of unique products, such as atomic weaponry, guided missiles and space vehicles, which are produced in the USA but not in the other two countries, and for which it would be difficult to derive dummy Brazilian and Mexican prices. There are also industries which are not unique, but near enough to impede comparison (such as aircraft, computers, oil drilling and other specialised machinery). These unique and quasi-unique industries were about 7 per cent of total US manufacturing output in 19715. Otherwise, there are very few industries which are truly comparison resistant, particularly if one makes supplementary inquiries with trade associations (which we did for motor vehicles, paints, petroleum products and bricks) where there were national idiosyncracies in measurement units or gaps in the census due to confidentiality rules. From the point of view of our other objective of comparing output, productivity and PPP outcomes for the three countries, the results can always be improved by increasing the sample size, but we felt that there was already reasonable coverage of major industry branches in Brazil and Mexico, and weaknesses only for food products and electrical machinery for the USA (see table 1.4 in chapter I). Having already spent 5 man years on the project and obtained a big enough sample to fulfil our methodological objective reasonably well, we felt that the priorities in such research now lie elsewhere, as mentioned below.

# h) Approaches to the Problem of Double Deflation

The important unsolved problem in this study is that of double deflation. Virtually all analysts who have used the industry of origin approach have been unable to find separate PPPs for inputs. The double deflation approach is feasible for agriculture (Van Ooststroom and Maddison, 1985), but not for manufacturing in these three countries, because the Brazilian and Mexican censuses give only rather global value figures on inputs with no detailed quantitative information, and the US census gives detailed figures only for energy consumption, contract work, and inputs directly related to the production process.

In agriculture the difference between the gross output PPPs and the double deflated PPPs was rather small. For Brazil the 1975 PPP (Brazil quantity weights) was 7.35 cruzeiros to the US dollar, 6.63 for inputs and 7.57 for value added. For Mexico the 1975 PPP (Mexican weights) was 13.46 pesos to the US dollar, 13.68 for inputs and 13.36 for value added.

In manufacturing, inputs are much bigger in relation to gross output than in agriculture, but in the USA 60 per cent of these are from manufacturing itself and in Mexico 48 per cent (see input/output tables in chapter II). For manufaLturing as a whole therefore, it does not seem a priori likely that the PPPs resulting from "double deflation" would be very different from those in our study, but for particular branches they might vary a good deal more.