The Big Mac Index, introduced by The Economist magazine more than two decades ago, claims to provide the “true value” of a large number of currencies. This paper assesses the economic value of this index. We show that (i) the index suffers from a substantial bias; (ii) once the bias is...

The Big Mac Index, introduced by The Economist magazine more than two decades ago, claims to provide the quot;true valuequot; of a large number of currencies. This paper assesses the economic value of this index. We show that (i) the index suffers from a substantial bias; (ii) once the bias is...

(1) The paper uses the substitutability between goods to model the transmission to other products of a consumption shock to one product. The framework is used to analyse the impact on drinking of legalisation of marijuana. For all types of consumers for example, the results indicate that...

This paper introduces a simulation procedure in the context of a demand system for vice -- marijuana, tobacco and alcohol -- to formally account for the inherent uncertainty in marijuanarelated data and parameters. This entails using existing econometric estimates pertaining to the consumption...

Government agencies around the world produce indexes that purport to measure international competitiveness. The most common version is the real effective exchange rate, which is some form of weighted average of the real exchange rates of the country’s trading partners. Such indexes convey a...