The Hedonic Country Product Dummy Method and Quality Adjustments for Purchasing Power Parity Calculations

The 2005 International Comparison Program's (ICP) estimates of economy-wide purchasing power parity (PPP) are based on parity estimates for 155 basic expenditure headings, mainly estimated using country product dummy (CPD) regressions. The estimates are potentially inefficient and open to omitted variable bias for two reasons. First, they use average prices across outlets as the left-hand-side variable. Second, quality-adjusted prices of non-comparable replacements, required when products in outlets do not match the required specifications, cannot be effectively included. This paper provides a

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Year of publication:	2009
Authors:	Silver, Mick S.
Publisher:	Washington : International Monetary Fund
Subject:	Theorie \| Theory \| Statistische Methode \| Statistical method \| Kaufkraftparität \| Purchasing power parity

Extent:	Online-Ressource (51 p)
Series:	IMF Working Papers ; v.Working Paper No. 09/271 IMF working paper ; WP/09/271
Type of publication:	Book / Working Paper
Language:	English
Notes:	Description based upon print version of record Cover Page; Title Page; Copyright Page; Contents; I. Introduction; II. The 2005 ICP Methodology; A. Aggregation at the Basic Heading Level; B. Checklists, Missing Observations, Non-Comparable Replacements, and Quality Adjustments; III. The Hedonic CPD Method and Use of Grouped Data; A. A CPD Regression Using Averages Across Outlets; B. A Hedonic CPD Regression Using Averages Across Outlets; C. A Hedonic CPD Regression Based Only on Selected Stratifying Factors, not Covariates; D. Explicit Quality Estimates; E. Explicit Hedonic Quality Adjustments IV. The Hedonic CPD Method and Use of Ungrouped DataA. A CPD Regression with Outlet Interaction Terms; B. A Hedonic CPD Regression; C. A Pooled Cross-Country Hedonic Regression; D. The Choice of Estimator for a Hedonic CPD Regression; Fixed effects estimator; Random effects estimator; Hausman and Taylor estimator; Tests for choosing among estimators; V. Summary; Footnotes
ISBN:	978-1-4518-7416-7 ; 978-1-4527-8537-0 ; 978-1-4518-7416-7
Source:	ECONIS - Online Catalogue of the ZBW

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