Rationalizing the Penn World Table: true multilateral indices for international comparisons of real income
Real incomes are routinely compared internationally using methods that "correct" for deviations from purchasing power parity. The most widely used of these is the Geary method which, though theoretically suspect, underlies the Penn World Table. This paper provides a theoretical foundation...
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| Materiálatiipa: | Journal article |
| Giella: | English |
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American Economic Association
2004
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| Fáttát: |
| _version_ | 1826297023250300928 |
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| author | Neary, J |
| author_facet | Neary, J |
| author_sort | Neary, J |
| collection | OXFORD |
| description | Real incomes are routinely compared internationally using methods that "correct" for deviations from purchasing power parity. The most widely used of these is the Geary method which, though theoretically suspect, underlies the Penn World Table. This paper provides a theoretical foundation for the Geary method which I call the GAIA ("Geary-Allen International Accounts") system. I show that the Geary method is exact when preferences are non-homothetic Leontief and, more generally, gives a (possibly poor) approximation to the GAIA benchmark. An empirical application suggests that both it and other widely used methods underestimate the degree of international inequality. |
| first_indexed | 2024-03-07T04:25:17Z |
| format | Journal article |
| id | oxford-uuid:cc690ce5-bbff-4ab5-a95f-8f8f1b0902ea |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-07T04:25:17Z |
| publishDate | 2004 |
| publisher | American Economic Association |
| record_format | dspace |
| spelling | oxford-uuid:cc690ce5-bbff-4ab5-a95f-8f8f1b0902ea2022-03-27T07:21:46ZRationalizing the Penn World Table: true multilateral indices for international comparisons of real incomeJournal articlehttp://purl.org/coar/resource_type/c_dcae04bcuuid:cc690ce5-bbff-4ab5-a95f-8f8f1b0902eaEconomicsEnglishOxford University Research Archive - ValetAmerican Economic Association2004Neary, JReal incomes are routinely compared internationally using methods that "correct" for deviations from purchasing power parity. The most widely used of these is the Geary method which, though theoretically suspect, underlies the Penn World Table. This paper provides a theoretical foundation for the Geary method which I call the GAIA ("Geary-Allen International Accounts") system. I show that the Geary method is exact when preferences are non-homothetic Leontief and, more generally, gives a (possibly poor) approximation to the GAIA benchmark. An empirical application suggests that both it and other widely used methods underestimate the degree of international inequality. |
| spellingShingle | Economics Neary, J Rationalizing the Penn World Table: true multilateral indices for international comparisons of real income |
| title | Rationalizing the Penn World Table: true multilateral indices for international comparisons of real income |
| title_full | Rationalizing the Penn World Table: true multilateral indices for international comparisons of real income |
| title_fullStr | Rationalizing the Penn World Table: true multilateral indices for international comparisons of real income |
| title_full_unstemmed | Rationalizing the Penn World Table: true multilateral indices for international comparisons of real income |
| title_short | Rationalizing the Penn World Table: true multilateral indices for international comparisons of real income |
| title_sort | rationalizing the penn world table true multilateral indices for international comparisons of real income |
| topic | Economics |
| work_keys_str_mv | AT nearyj rationalizingthepennworldtabletruemultilateralindicesforinternationalcomparisonsofrealincome |