INTRA-HOUSEHOLD ALLOCATIONS IN RURAL ETHIOPIA: A DEMAND SYSTEMS APPROACH

This article examines the effects of price, income and demographic changes on intra-household allocations by integrating the outlay equivalent method into the Quadratic Almost Ideal Demand System (QUAIDS). Tests for separability in preferences and "demographic separability" are conducted. Longitudinal data to control for household heterogeneity are used. Results indicate that Ethiopian rural households respond to price, income and demographic changes in a more complicated manner than usually presumed; price, income and demographic changes do not have similar effects on all household members. Income changes affect men and boys more than women and girls, but variations in prices affect women and boys more than men and girls. Even though outlay equivalent ratios on average indicate discrimination against girls, girls are more protected from fluctuations in income and prices compared to boys. The results highlight limitations of previous studies that ignore direct income and price effects.     

收入差距、家庭可支配收入与商品房价格：基于广州市的实证研究

论文使用1998—2009年广州市商品房价格和城镇居民不同收入家庭可支配收入来分析房价与收入差距和家庭可支配收入之间的关系。实证检验发现,收入差距扩大为房价上涨的Granger原因,但是房价并不是收入差距的Granger原因。房价对低、中低收入户的家庭可支配收入有较大影响,而中、中高收入户的家庭可支配收入是房价上涨的主要推动力量,高收入家庭既促进了房价上涨同时也从中受益最大。政策制定应该依据房价与不同收入户的家庭可支配收入之间的关系而具体实施,不能一概而论。     

Decomposing the determinants of road traffic demand

This study presents a decomposition of the basic fundamental determinants of road traffic and fuel demand. A general framework is proposed as a means of analysing the impacts of changes in prices and income on the demand for fuel and traffic volume. The objective is to provide a general basis for comparing different road traffic elasticity estimates and for understanding how a variety of different factors work together to create overall road traffic and fuel demand responses. The study emphasizes relationships between different price and income elasticity measures and uses estimates from the literature to evaluate the main determinants of demand including some previously unobserved effects.     

Consumer welfare effects of increased food and energy prices

In this study, the authors evaluated how much price changes in food and energy – two basic living expenditures competing for consumers’ budgets – would affect consumer welfare. We first estimated a US complete demand system to quantify the interdependent demand relationships among 11 categories of consumption expenditures. Among the estimates, the own price elasticities of both food and energy are relatively inelastic, a finding that explains the dynamics of the recent soaring food and energy prices. The estimated demand elasticities were then incorporated into the measurement of Hicksian compensating variation to analyse the consumer welfare effects of price changes in food and energy. The results indicated that an increase in food and energy prices would increase compensated expenditures or incur a substantial consumer welfare loss, creating an especially heavy burden for low income households.     

Reforming the new economic mechanism in Hungary

Following steps taken towards recentralization between 1972 and 1976, the reform measures introduced in 1980 and 1981 have re-established the original directions of the New Economic Mechanism in Hungary. The NEM, established in 1968, had aimed at replacing plan directives by market relations among firms, limiting the scope of central price determination, linking domestic prices to world-market prices, and increasingly decentralizing investment decisions. The recent reform measures are evaluated and possible future changes are considered. Price setting, exchange rate and protection, wage determination and personal income, investment decisions, and organizational structure are examined.     

房价上涨与中国城市“新二元结构”的加剧

中国城市中以外来流动人口与本地居民收入差距扩大为特征的“新二元结构”正在制造新的不平等。本文理论分析发现：房价上涨导致城市本地居民收入提高、外来流动人口收入下降。本文将2014—2015年全国流动人口动态监测数据匹配到251个城市，实证检验表明房价上涨显著加剧了城市“新二元结构”，该结论在不同子样本与稳健性检验中都成立；作用机制检验表明房价通过引起城市本地居民收入提高与外来流动人口收入下降加剧了城市“新二元结构”。     

PRIM I: A MODEL OF THE PRICE AND INCOME DISTRIBUTION MECHANISM OF AN OPEN ECONOMY

PRIM I is a numerical model which has been extensively used as a basis for an income policy in Norway in recent years. It is a static, cost-push, input-output model. Wage rates, agricultural prices, productivities and world market prices are treated as exogenous variables, and the model derives short-term changes in income shares and in the national price level from changes in these exogenous variables. A key feature of the model is a distinction between "exposed industries" which are subject to strong foreign price competition, and "sheltered industries" which are relatively free of such competition. These two groups of industries are found to react with very different pricing policies in response to increases in costs; furthermore, possibly for technological reasons, the export industries have greater scope than the majority of the sheltered industries for compensating cost increases through productivity gains. These two facts are shown to have important implications for a price and income policy. It is demonstrated, i.a. that the goal of a stable national price level is, in general, inconsistent with the maintenance of stable income shares when exchange rates are kept constant.     

Attendance and pricing at sporting events: empirical results from Granger Causality Tests for the Melbourne Cup

This study applies Granger causality tests to examine the relationship between attendance, admission prices and real income at the Melbourne Cup, which is Australia’s premier horseracing event and one of the world’s leading handicap races. The motivation for the paper is that while market demand suggests that causation should run from admission price to attendance, it is equally plausible that sporting authorities could alter admission prices in response to a change in demand reflected in attendance. The main findings are that in the short-run there is unidirectional Granger causality running from income to attendance, attendance to admission price and income to admission price, while in the long run both admission price and income Granger cause attendance.     

Empirical Evidence on the Austrian Business Cycle Theory

The Austrian business cycle theory suggests that a monetary shock disturbs relative prices, such as the term structure of interest rates, systematically altering profit rates across economic sectors. Resource use responds to those changes, generating a cyclical pattern of real income. The divergence of the interest rate structure, from the previous and unchanged time preferences, means that the expansion is unsustainable and must end in recession. Quarterly data for eight U.S. business cycles, 1950:1 through 1991:1 are standardized by time period and used to explore business cycle facts and relations between money, interest rates, capacity utilization and income. Results are consistent with the hypotheses of the Austrian theory of a business cycle caused by a monetary shock and propagated by relative price changes.     

China wage inequality: the role of trade and technology

This article empirically investigates the impact of international trade and technical change on skill premia for a panel of 28 manufacturing sectors in China over the period 2002–2011. The results find that the effect of changes of the share of SOEs is twofold. First, the contraction of SOEs promoted productivity growth, and the promoting effect was skill-biased, which tended to increase the skill premia in China. Second, the drop of product prices resulting from falling SOEs share was more magnificent in skill-intensive industries, which helped to mitigate wage inequality through product prices. The accounted-for portion of price changes by productivity growth was skill-biased, significantly raising skill premia through product prices. However, the portion of price changes accounted for by foreign price was unskill-biased, and world price competition diminished the growing income disparity in China.     

经济增长、物价变动对农村居民收入影响探析

基于1984-2013年全国农业生产总值、农村居民消费价格指数和农村居民家庭人均纯收入数据,研究农村经济、物价变动对农村居民收入的影响。研究表明:长期来看,三者之间存在长期均衡关系。这说明农村经济的增长会提高农村居民收入,物价的变化则会反向影响农村居民收入。而短期来看,物价的上涨会增加农村居民的人均纯收入,农村经济的增长则不会对农村居民收入有明显的影响作用。     

NEW INSIGHTS INTO THE STRUCTURE OF THE WORLD ECONOMY*

The United Nations' newly completed study of purchasing power parities covering 34 countries varied in region, income level, and form of economic organization shows the systematic differences between the usual view of the structure of the world economy arising out of international comparisons based upon foreign exchange rate conversions and the structure one sees when actual prices are available. The real per capita GDP of developing countries is understated relative to developed countries when exchange rates are used in converting countries' national income accounts to a common currency, with the degree of understatement for any two countries being inversely related to the per capita income difference between them. The reason for this is that relative prices in the non-traded goods sector are lower relative to traded goods prices in low income countries. The systematic pattern observed in the 1975 data of the 34 countries has been extrapolated over time and space to get estimates of GDP for other years and countries. In the absence of detailed price data, the real shares of final expenditures devoted to particular components of the total can only be estimated as the proportion of own currency total expenditure devoted to the components. The observed differences in the pattern of prices of poor countries relative to rich for different components makes this clearly wrong for international comparisons, and in systematic ways. For example, (i) the relative price of services compared with commodities in poor countries is lower than in rich; so the apparent tendency of the share of services to rise as a country's income rises disappears when real quantities are considered; similarly, (ii) the relative price of capital goods is greater in poor countries compared with rich ones, so the difference in investment ratios out of GDP between rich and poor countries is understated.     

Estimating fundamental and affordable housing price trends: a study based on Singapore

Policy-makers often impose some cooling measures on the housing market when housing prices rise fast. Such policies yield limited success if housing prices are driven up by fundamentals. Estimating a fundamental price trend from observed price data is a challenge. We present an empirical methodology to separate housing price trends into fundamental and affordable components. Deviating from the common practice, we replace current income by a long-run income measure constructed from household incomes at different quantiles. This income measure provides a more suitable basis for constructing affordable house price levels. It also serves as a better fundamental variable, especially for segmented housing markets like that of Singapore. These price trends provide policy-makers with useful information to intervene into property markets to achieve desirable outcomes. Analysing Singapore data using this methodology shows the magnitudes of the price gaps between actual and fundamental prices and how housing affordability fluctuates over price cycles.     

The Differential-Productivity Hypothesis and Purchasing-Power Parties: Some New Evidence*

The structure of prices of goods entering into international trade relative to those that do not plays a key role in the Balassa-Samuelson explanation of why countries ‘exchange rates differ systematically from their currencies’ purchasing power. the B-S analysis leads to the proposition that the tradable-nontradable price difference is lower for rich countries than for poor. This paper examines the gap, using prices collected by the International Comparison Programme. A variety of regressions were run to see if indeed the difference between tradable and nontradable price parities moved with income in the way B-S expected. They did.     

MEASURES OF INTERNATIONAL RELATIVE PRICES FOR CHINA AND THE USA

Abstract.  In this paper we assemble a measure of international relative prices to gauge the average amount by which prices in China and the USA differ from the prices of their trading partners. Our estimated weighted average of relative prices for China and the USA are the first to use the significantly revised purchasing power parities embodied in the price data from the World Bank's World Development Indicators. Our analysis reveals several findings of interest. First, interactions between the structure of trade and the levels of relative prices are sufficiently important to induce divergences between the weighted average of relative prices and conventional real effective exchange-rate indexes. Second, revisions embodied in World Development Indicators price data generally lower the estimate of US international relative prices. Third, net exports are inversely related to the estimate of US international relative price, but, for China, the correlation is positive. Estimating this correlation for other countries reveals no systematic pattern related to the level of development alone. Fourth, unlike previous work, using our price measures we find that an increase in US prices relative to Chinese prices raises the share of China's exports to the USA. Finally, there is a distinct possibility of eliminating the long-standing differential in income elasticities of US trade in empirical applications.     

Decomposing the Changes in Production Prices into "Capital-Intensity" and "Price" Effects: Theory and Evidence from the Chinese Economy

This paper deals with the changes in prices of production inducedby variations in income distribution on the basis of a linearmodel of production with circulating capital and homogeneouslabour. It is shown that the total effect of income distributionon prices can be decomposed into a "capital-intensity" and a"price" effect and that, in actual economies, the former isexpected to dominate the latter. In order to obtain a concreteidea of the actual trajectories of the price movements and toquantify the relative strength of the two effects, we use input–outputdata of the Chinese economy.     

House price dynamics: Evidence from Beijing

To study the house price dynamics in China, this paper extends the traditional life-cycle model by incorporating land supply, regime shifts and government regulation factors. The models are estimated with an error correction framework using quarterly data from 2000 to 2007 in Beijing. The conclusions are as follows. (1) There exits a stable co-integration relationship between house price and fundamentals; land supply and financial regimes are also important determinants of long-run equilibrium house prices. (2) Short-run dynamics depend on changes of fundamentals and the adjustment process of housing market. Land supply has a significant impact on house price fluctuations while demand factors such as user costs, income and residential mortgage loan have greater influences. The adjustment speed of real house prices to the long-run equilibrium has been reduced significantly since 2005 which means exogenous shocks can cause prolonged deviation of real house prices from the equilibrium level.     

Welfare and Distribution Effects of Water Pricing Policies

In this paper, distribution and welfare effects of changes in block price systems are evaluated. A method is discussed to determine, for a Marshallian demand function, equivalent variation in case of a block price system. The method is applied to compare, for the Metropolitan Region of São Paulo, alternative pricing policies on the basis of their demand, welfare and distribution effects of changing water prices. Results show that there is a trade off between average welfare and income distribution. A pro-poor price system may result in lower average welfare than a flat price system, but in higher individual welfare for the poor. Moreover, there is a trade off between revenues for the water company and income distribution. Even though pro-poor price systems may not be as good for average welfare as flat price systems, their direct effects on poverty are important. Introducing pro-poor price systems, however, may have financial consequences for the water companies.     

INTERTEMPORAL COMPARABILITY OF NATIONAL INCOME IN CZECHOSLOVAKIA

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.     

COMPTABILITE NATIONALE A PRIX CONSTANTS ET A PRODUCTIVITE CONSTANTE

The problem of national accounting “at constant prices” is in fact a problem of comparability of time series, as changes in the price structure preclude any direct comparison of economic flows. If such accounts are established they will make it possible directly to compare the same flow at two different times in the economy as a whole, and this without leaving the influence of other flows out of account. This makes it possible both to synthesize and to undertake analytical comparisons. The accounts could then be used for the study of time series, for projections or for structural studies (e.g. the mechanisms underlying the changing pattern of income distrubution). The first part of this report sets out to study the main problems of compiling accounts at constant prices and to examine what conventions should be adopted. The second part of the report considers how productivity gains can be explicitly shown in the national accounts. The proposed study plan restores the symmetry between price and productivity. As in the accounts at constant prices, gap variables are introduced to measure productivity gains. These variables can be interpreted in terms of surplus; the concept of surplus used here, however, is not the one adopted for the accounts in constant prices, but its dual. Setting up an accounting system “at constant productivity” therefore makes it possible to complete the information provided by an accounting system “at constant prices.” These two systems can of course be integrated: this leads to the introduction of the concept of an accounting system “at constant prices and constant productivity.” Such an accounting system makes it possible to show, in the same accounting framework, the respective contributions of price changes and improved productivity to the gains realised by the different economic agents. It therefore gives a complete picture of “transfers” between the agents. At the same time, the data on price and productivity can be integrated with each other.