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Author Missong, Martin ♦ Rolf, Anja
Source EconStor
Content type Text
File Format PDF
Language English
Subject Domain (in DDC) Social sciences ♦ Economics
Subject Keyword Kaufkraftparität ♦ Regionalforschung ♦ Empirische Methode ♦ Deutschland ♦ Index Numbers and Aggregation; Leading indicators ♦ Consumer Economics: Empirical Analysis ♦ Global Outlook
Abstract Calculation of purchasing power parities based on observed consumer behaviour typically relies on the existence of some kind of 'international preferences'. We argue that this unrealistic assumption can be abandoned in 'regional' studies of purchasing power, where prices in both territories under study might differ only slightly. Drawing on recent results for the derivation of equivalence scales, we develop a model of regional purchasing power and discuss several procedures for testing model specification. The model is applied to data of the German Income and Expenditure Survey 1998 to estimate the wedge between purchasing power in the western and eastern part of Germany.
Part of series FE working paper // University of Kiel, Department of Food Economics and Consumption Studies x0403
Learning Resource Type Article
Publisher Date 2004-01-01
Rights Holder http://www.econstor.eu/dspace/Nutzungsbedingungen