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Basic Ideas on Stochastic Indices

  • Bernd Mundlos
  • Jochen Schwarze

Abstract

Since the classical definitions of Price Index Numbers by LASPEYRES and PAASCHE this theory has been extended by new, more complicated and refined expressions for meaningful index formulas. Furthermore methods to test the properties of such formulas were developed. In particular, FISHER’s tests such as the Proportionality-, the Circular- and the Factor-Reversal-Test are notable, having caused far-reaching discussions in the literature on index numbers. WALD [10] proved that no index formula satisfies the three mentioned tests simultaneously. Other work on satisfaction of the tests has been done by ACZEL-EICHHORN [1], EICHHORN-VOELLER [5] and the detailed examination by VOELLER [9]. For the best known index, the Cost of Living Index (CLI), which is mainly a price-index, and which we want to consider here, the index formulas and the variables used to compute the index will be discussed. This ultimately involves an intensive discussion about utility, (see e.g. [6],[10]), but this matter is not in the scope of this paper.

Keywords

Central Limit Theorem Index Number Index Formula Sample Index Intensive Discussion 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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References

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Copyright information

© Springer-Verlag Berlin Heidelberg 1978

Authors and Affiliations

  • Bernd Mundlos
  • Jochen Schwarze

There are no affiliations available

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