A Measure of Inflation in Pakistan

Abstract

Although a number of series on wholesale and retail prices are being published by the Central Statistical Office and other organizations, there is no general price index to measure annual price changes in the country. The price indices (composed of more than one commodity) presently available in Pakistan are cost of living indices of limited coverage. This mono¬graph presents an annual wholesale price index for the purpose of measuring the extent of inflationary pressure in Pakistan. The index is computed for the East and West wings separately and for the whole of Pakistan. It dates from 1951-52 through 1959-60 (July-June), with 1951-52 as the base year. Owing to lack of data, it was not possible to carry the index back to Partition, while the need for accuracy precluded the construction of the index on a quarterly or monthly basis. The choice of 1951-52 as the base year is inevitable if the special conditions of the Korean Boom, its aftermath and the Plan period are to be avoided. Moreover, 1951-52 was a year of fewer controls, and prices in that year did not differ much from the preceding two years.