Estimating efficiency prices through semi‐input‐output methods—a review of practice in available studies

Abstract

AbstractSemi‐input‐output (SIO) methods offer an opportunity for the simultaneous estimation of accounting price ratios (APRs) for a large number of sector products, aggregate classes of goods and for individual commodities. The paper reviews the main features of 13 SIO studies. Despite use of the same method, great variation existed between the sets regarding size of matrix, data sources, numbers of primary inputs and attempts to derive aggregate APRs. Reviews are made of the specifications and values of three main features of these studies: primary inputs, aggregate APRs and the ‘standard’ categories of non‐traded items. Considerable variation in all aspects occurred between the studies. Diversities in methods between the studies account for some of the differences in results, especially the levels of commodity or sector dis‐aggregation that were possible. However, the main differences reflect the substantial variations in underlying pricing and fiscal approaches of the administrations in the economies at the base periods for each estimation. Commonality in APR values between economies was not found, and cannot be assumed.