Book contents
- Frontmatter
- Contents
- Foreword
- List of contributors
- Part one The analysis of commodity demands
- Part two The theory of index numbers
- Introduction
- 6 On the constructability of consistent price indices between several periods simultaneously
- 7 The economic theory of index numbers: a survey
- Part three The consumption function and durable goods
- Part four Other aspects: fertility and labour supply
- Bibliography of Sir Richard Stone's works 1936–79
- Index of names
- Subject index
Book contents
- Frontmatter
- Contents
- Foreword
- List of contributors
- Part one The analysis of commodity demands
- Part two The theory of index numbers
- Introduction
- 6 On the constructability of consistent price indices between several periods simultaneously
- 7 The economic theory of index numbers: a survey
- Part three The consumption function and durable goods
- Part four Other aspects: fertility and labour supply
- Bibliography of Sir Richard Stone's works 1936–79
- Index of names
- Subject index
Summary
The theory and measurement of economic index numbers presents side by side some of the most difficult and abstruse theory with the most immediately practical issues of everyday measurement. The construction of index numbers is an essential part of all social accounting; without compression and aggregation the mass of quantities and prices thrown up by the economic system would be incomprehensible. Yet from the outset such aggregation has been known to be meaningful only in the context of welfare measurement. But to what extent are welfare-based index numbers practical? In his book on index numbers [56] written for the OEEC (now OECD), Sir Richard Stone addressed the question of whether practical international standards for index number construction could be established in line with his earlier standardized system of national accounts. Sir Richard gives the following reasons why the welfare approach is useful:
First, they give content to such concepts as real consumption which might otherwise be vague and obscure; second, they bring out the fundamental difficulties in establishing empirical correlates to concepts such as real consumption and so help to show what can and what cannot usefully be attempted in the present state of knowledge; finally they show the circumstances in which particular empirical correlates, such as a measure of real consumption which can actually be constructed, are likely to provide a good or a bad approximation to the concepts of the theory.
([56], pp. 18–19)Information
- Type
- Chapter
- Information
- Essays in the Theory and Measurement of Consumer Behaviour: In Honour of Sir Richard Stone , pp. 130 - 132Publisher: Cambridge University PressPrint publication year: 1981
Accessibility standard: Unknown
Accessibility compliance for the PDF of this book is currently unknown
and may be updated in the future.