Relative Price Indices Research Articles

EXAMINING THE VALIDITY OF PURCHASING POWER PARITY: EVIDENCE FROM SRI LANKAN CONTEXT IN RECENT PAST

This research study examined validity of Purchasing Power Parity (PPP) by studying the behaviour of nominal exchange rate and relative price levels between Sri Lanka and United States (US). The theory of PPP has been used to estimate the relationship between relative prices and nominal exchange rate between two countries. Exchange rate between USD/LKR has been taken as dependent variable whereas Relative Price Index between US Price Index and Colombo Consumer Price Index has been taken into consideration as independent variable. The study has been undertaken with the objective of estimating statistically whether Sri Lanka exists Purchasing Power Parity from January 2015 to December 2022. Data that has been collected for this study is monthly time series data from January 2015 to December 2022, which was collected from the data library of the Central Bank of Sri Lanka (CBSL) and data library of International Monetary Fund (IMF) have been used for this study. The results have been estimated using statistical techniques. These include mainly Augmented Dickey Fuller Test for Unit Root Testing, Descriptive Statistics, Ordinary Least Squared (OLS) method and Granger Causality Test. E-views statistical software is used to analyse the PPP model. Econometric Techniques are used to analyse the regression model.

지역별상대주택가격지수 개발에 관한 연구

Recently, in Korea, the polarization of real estate prices by region has deepened, causing social and economic problems. In particular, the government's expansion of taxation on owners of multiple homes to stabilize housing prices led to the exacerbation of the real estate price polarization between the metropolitan areas and local regions. As a methodology for monitoring this phenomenon of real estate price polarization by region, this study is based on 3 house transaction types for 4 house types targeting 17 cities and provinces and affiliated administrative districts, tentatively named 'Regional Relative House Price Index’. The purpose is to calculate the 'RRHPI' for observing trends in relative real estate prices by region at the national level, suggesting brand-new directions for conducting research related to the regional polarization phenomenon.

Application of Black Scholes Method to Determining Premium Insurance In the Potato Agricultural Based on Price Index

Potato is one of the leading horticultural commodities. Potato farming business often experiences price fluctuations that cause losses to farmers.The government is making efforts to minimize the farmers' losses by issuing agricultural insurance programs. This study aims to determine the relationship between potato prices at the provincial level and potato prices at the farmer level and to determine agricultural insurance premiums based on the price index. The data used are potato price data at the West Java Province level and potato price data at the farmer level in Pangalengan District. The correlation between provincial level prices and farmer level prices can be obtained using the Pearson Product Moment correlation method. The price index is calculated using the relative price index method. Determination of the premium to be paid by farmers using the Black-Scholes method. The results of the analysis show that potato prices at the West Java Province level have a very strong correlation with farmer prices in Pangalengan District in October. Based on the Black-Scholes method, the premium value depends on the trigger value obtained with a price range between IDR 9,806,100.00 to IDR 10,267,784.00 for a sum insured of IDR 39,403,000 per one contract period. Various premium values can be a consideration for farmers in choosing an agricultural insurance policy.

우리나라 주요 수출산업과 농식품산업의 수출결정요인 비교 분석

The global economy is slowing down significantly due to the Russia-U.S. war, rising raw material prices, and global monetary tightening, and the localization of global value chains and global supply chains is actively progressing, especially in countries that have been unstable in global supply chains due to global economic uncertainties. Against this backdrop, strengthening the agricultural base through agricultural exports needs to seek ways to strengthen competitiveness to foster agriculture as a new export industry as it can secure stable sources for major foods that are highly dependent on imports, including food resources, and can be a new opportunity to increase exports of agricultural and fishery foods. In this study, the export demand function of each major industrial group in Korea is estimated and compared with the determinants of export demand for agricultural products. As for the analysis target period, the top 10 exporting countries in Korea were set as analysis target countries for annual data from 1995 to 2022. In summary, it can be seen that factors affecting exports differ by industry group, and factors affecting the export of agricultural products are affected by the trade partner's gross domestic product, per capita gross domestic product, relative price index with trading partner, R&D investment, comparative advantage index by trading partner for specific products, and FTA signing or not.

An Econometric Analysis of the Determinants of Foreign Direct Investment: A Panel Data Analysis of Brazil and India

Foreign direct investment (FDI) has become a big source of non-debt funding in the world economy over the past 20 years. The goal of this study is to look at what makes Brazil and India attract FDI. The goal of this study is to figure out the most important reasons why FDI into India and Brazil keeps going up. The most important factors that affect FDI imports in Brazil and India are found using panel data regression analysis. The panel unit-root test, the Fisher Johansen test of cointegration, the panel vector error correction model, and the panel fully modified ordinary least squares (FMOLS) model has all been used to look at the data. In this study, FDI flows are considered as a function of India and Brazil’s relative consumer price index, gross domestic product, trade openness, human capital and population. The study shows that the size of the market and the number of people in a country have the biggest positive effects on drawing FDI. Inflation and trade openness, on the other hand, have little to do with attracting FDI to these two countries. Real GDP is used to measure the size of the market, and it is a major positive predictor of FDI. This means that most investment in these countries is driven by a desire to get into the market.

What factors contribute to the extent of decoupling economic growth and energy carbon emissions in China?

Based on the IGT equation, we calculate the decoupling index Dr of China's economic growth and energy CO2 emissions from 1978 to 2020, and analyze the evolution trend of the decoupling development between the two. Then, based on the ARDL model, the factors influencing the decoupling relationship are empirically tested and analyzed. The findings are threefold. (1) In the long term, the decoupling is effectively promoted by the relative energy price index, the increase in the clean energy proportion and the strengthening of government intervention. And the decreases in research and development investment, foreign trade, and the ratio of tertiary to secondary industry elicit the same direction on the decoupling relationship. (2) In the short term, the decline in the current increment of government intervention is the strongest contributor to the decoupling relationship, followed by the rise in the current increment of the ratio of the tertiary to the secondary industry. (3) The combined results of historical decomposition, impulse response, and variance decomposition indicate that clean energy share shocks, research and development intensity shocks, and relative energy price index shocks are the main sources of Dr fluctuations. The results of the study can provide a reference for achieving carbon reduction in China.

디지털농업 결정요인이 우리나라 농식품수출에 미치는 영향분석

As the instability of the global economy continues after Covid-19, international trade is finding a new turning point. In particular, through the development of information and communication technology, all industries are attempting digital transformation and establishing a new economic system. Recently, the agricultural sector is facing the challenge of strengthening export competitiveness beyond food security in each country. Amid these changes, the emergence of digital agriculture has emerged as an alternative to creating new opportunities in the global market through agriculture.
 This study analyzed the impact of determinants for domestic digital agriculture transition on agricultural exports and presented implications. The analysis model was set as the export supply function, and the actual economic growth rate, including the relative price of export products, and the public R&D intensity, including public R&D expenses, and the number of professional researchers were selected as determinants for the digital transformation of the agricultural sector. Looking at the analysis results, the export relative price index generally used in the export supply function was analyzed to have a positive (+) effect, but the real economic growth rate, a substitute variable for domestic demand pressure, did not show statistically significant results. In addition, among the determinants of digital agriculture, R&D costs and intensity were analyzed to have a positive effect on agricultural exports, but the number of professionals did not produce statistically significant results. Summarizing the analysis results, it is understood that the expansion of R&D and investment for digital agriculture has a direct impact on agricultural exports, and the need for active investment and development in creating a digital agricultural foundation in the domestic agricultural sector in the future.

Food availability and affordability in a Mediterranean urban context: associations by store type and area-level socio-economic status.

Although food environments have been highlighted as potentially effective targets to improve population diets, evidence on Mediterranean food environments is lacking. We examined differences in food availability and affordability in Madrid (Spain) by store type and area-level socio-economic status (SES). Cross-sectional study. Trained researchers conducted food store audits using the validated Nutrition Environment Measures Survey in Stores for Mediterranean contexts (NEMS-S-MED) tool to measure the availability and price of twelve food groups (specific foods = 35). We computed NEMS-S-MED scores and summarised price data with a Relative Price Index (RPI, comparing prices across stores) and an Affordability Index (normalising prices by area-level income). We compared the availability and affordability of 'healthier-less healthy' food pairs, scores between food store types (supermarkets, specialised, convenience stores and others) and area-level SES using ANOVA and multi-level regression models. City of Madrid. 2016 and 2019 to cover a representative sample. Food stores within a socio-economically diverse sample of sixty-three census tracts (n 151). Supermarkets had higher food availability (37·5/49 NEMS-S-MED points), compared to convenience stores (13·5/49) and specialised stores (8/49). Supermarkets offered lower prices (RPI: 0·83) than specialised stores (RPI: 0·97) and convenience stores (RPI: 2·06). Both 'healthy' and 'less healthy' items were more available in supermarkets. We found no differences in food availability or price by area-level SES, but affordability was higher in higher-income areas. Supermarkets offered higher food availability and affordability for healthy and less healthy food items. Promoting healthy food availability through supermarkets and specialised stores and/or limiting access to convenience stores are promising policy options to achieve a healthier food environment.

Inflation in Russia: Differences Between Official Data and Population's Perception

The article is devoted to the study of the reasons for the formation of differences between the official measurement of inflation in the Russian economy and the subjective perception of inflationary processes by the population.The introductory part of the article shows that the population's estimates of inflation in Russia (perceived inflation) are more than twice as high as official data. There is no consensus in the scientific literature on the explanation of this bias, which determines the relevance of the study. Due to the high level of observed inflation, households may believe that the real yield of financial instruments is negative and prefer consumption to savings, including through loans. The purpose of the article is to determine the causes of discrepancies between official inflation indicators and estimates of price growth for goods and services by the population.The main part of the article analyzes the time series of the Rosstat consumer price index from 2014 to 2021, data from the Bank of Russia on inflation perceived by the population, macroeconomic indicators of the International Monetary Fund, including the dynamics of price indices of 12 groups of goods and services in 86 countries. Methods of descriptive, correlation and regression analysis were used. There are two main cognitive reasons why the level of inflation perceived by the population exceeds the official one. Firstly, in the course of surveys, according to the author, respondents often incorrectly determine the time frame (perceiving the price increase not for one year, but for a period of about two years). Secondly, the population (households as respondents) pays attention primarily to the goods that have risen in price most significantly (further increasing the gap in estimates). In addition, the population perceives the end of discounts on individual goods as a multiple overall price increase. Based on a cross-country comparative analysis of price indices, the author suggests that the increase in the variability of the relative price index leads to an increase in discrepancies between official inflation data and estimates of inflation by the population.In the final part of the article, conclusions are formulated – the author's positions on the problem under consideration, according to which it is proposed to increase the financial and statistical literacy of Russians in order to reduce differences in estimates of inflation by official statistics and the population.

Commodity terms of trade shocks and political transitions

AbstractIn this paper, we estimate the effects of relative international commodity prices on political transitions accounting for time trends (since democracy might evolve in waves) and the fact that different autocratic regime types might respond differently. A standard deviation (2.1 percentage points) decrease in the growth rate of our 3‐year moving‐average relative price index increases the democratic transition probability by 0.5 percentage points or 13% of the mean probability. The transition probability moves nearly one for one with economic growth. Military autocracies might democratize after positive shocks. The autocratic‐transition effects are negative but insignificant.

An Analysis of the Effects of Agricultural Export Determinants on Export Expansion

Purpose - Globalization has made it possible to divide and specialize across borders, and efficiency-oriented production and consumption have become mainstream. In particular, following COVID-19, the global supply chain has faced a crisis, promoting the localization of supply chains that expand domestic production, and focusing on daily necessities, national strategic products, and food. This study recognizes the structural changes in the agricultural product market in the process of promoting globalization and attempts to estimate the effect of the determinants of the export of agricultural products in Korea on exports. Design/Methodology/Approach - This study aims to analyze the effect on the export of agricultural products by deriving export demand factors for Korean agricultural products from 1996 to 2019 targeting 28 countries that have signed FTAs with Korea. As for the analysis method, the most generalized panel analysis is used to analyze time series data and cross-sectional analysis data. Findings - As a result of estimating the export demand function of agricultural products, it was estimated that the other nation s income (GDP), per capita income (PGDP), exchange rate (EXR), and free trade agreement (FTA), which are determinants of agricultural exports, affected Korea s agricultural products. In particular, it was found that a Free Trade Agreement (FTA) greatly contributed to the expansion of agricultural exports. However, contrary to the analysis expectations, it was analyzed that the relative price index (REPRI) did not directly affect exports. Research Implications - This study derives the most representative variable among the export determinants on the export of Korean agricultural products covered in previous studies whether it actually affects export expansion. Based on the estimated results, it is meaningful in that it presented the necessity of exporting agricultural products to improve income and competitiveness in the domestic agricultural sector.

Food Security Index For Economic Community of West-African States (ECOWAS)

Purpose: In this article attempt is made to develop a composite food security index for some selected countries of the Economic Community of West-African States (ECOWAS), e.g. Nigeria, Niger, Benin, and Ghana. The study also aims to study the stability property of the indicators of composite food security index. Approach/ Methodology/ Design: For constructing a composite food security index for ECOWAS, one can use the basic methodology already developed by IFAD but in a modified form. This study is also based on IFAD methodology but with one more additional variable that is political stability index and assigned weight on the basis of Principal Component Analysis (PCA). Findings: This composite index is an improvement over all the other food security index developed by others eminent economists and institutions from time to time. This index consists of six indicators such as food availability, food production, self-sufficiency of food, inverse relative price index, child survival index, and political stability to construct the composite food security index of ECOWAS. Political stability is an additional indicator in the index of ECOWAS. With the help of this index, the trends, stability and situation of food security index in region are discussed and analyzed from 2001 to 2018.After careful analysis of composite food security index of ECOWAS, one can find out that It has quite impressive and improving gradually. Practical Implication: This study provides strong suggestion about how these five indicators of composite food security index provide an overview for the selected countries to secure their level of food security in their respective country. Originality/Value: After the careful analysis of the collected data, it can be concluded that the composite food security index plays an important role to understand whether food security index is improving in respective countries or not.

Housing vintage and price dynamics

The vintage of a home often refers to a period-specific collection of architectural characteristics, materials, and quality. Due to age, cost of materials and construction, some vintages may not be easily reproduced — effectively rendering them supply constrained. More conventional sources of supply constraints like high levels of land use regulation influence the risk and reward profiles of homes. Are similar supply constraint-induced dynamics associated with particular vintages? In other words, does the vintage of a house influence its price dynamics? Using residential property transaction data from the Netherlands spanning 2000–2017, we construct relative price indexes for three vintages. A repeat sales model with granular location × year fixed effects and time varying maintenance controls allows for the identification of the effect of vintage on price dynamics. In general, older and more architecturally desirable vintages (pre-1900 and 1900–1945) display larger returns. From a practical point of view, the vintage driven variation in price dynamics we observe has implications for institutions concerned with modeling real estate returns and risk.

Research of the impact of quality on the competitiveness of imitated surimi products

The aim of the work was to develop a new methodology for determining the competitiveness of goods on the basis of their quality characteristics and consumer value, as well as to determine with its use the competitiveness of crab sticks of domestic and foreign production. For the first time, a comparative assessment of the consumption properties of antimony products and their competitiveness was used. The impact of quality indicators on the competitiveness of surimi products was found. Research methodology. In the study of quality indicators, the commonly used methods, which are provided by state standards, were used. The determination of competitiveness was based on a comparison of the parameters of the studied product with the parameters of the product that most fully reflects the requirements of consumers. Purpose. To study the consumer indicators of quality of surimi products and determine the competitiveness of crab sticks of domestic and foreign production. For the first time, a comparative assessment of the consumption properties of surimi products and their competitiveness was used using the new method. The influence of quality indicators on the competitiveness of surimi products is revealed. The subject of the study was surimi products, namely crab sticks of the premium brand, manufactured by Aquafrost LLC; the Santa Bremor trademark (manufactured by the Republic of Belarus); the Crab Krabych trademark (manufactured by Lithuania); the VICI trademark (manufactured by Lithuania) and the Water World trademark manufactured by Aquafrost LLC. The subject of the study was the consumer properties of the product and their consumption value. Research methods. In the study of quality indicators, we used the standard methods prescribed by national standards. The determination of competitiveness was based on a comparison of the parameters of the investigated product with the parameters of the product, which most fully reflects the requirements of consumers according to the newly developed method. To determine the consumption properties of the product (crab sticks) used the standard method according to DSTU ISO 4121: 1987 Sensory analysis. Scaling of food products. The newly developed method of assessing competitiveness was carried out by determining the relative quality index and the relative retail price index. For the first time, a method for determining the competitiveness of goods based on the indices of the consumer properties of the goods and the consumption value was developed and implemented. The influence of consumption properties and cost on the competitiveness of crab sticks of domestic and foreign manufacturers was studiedIt is proved that the competitiveness of crab sticks depends on their quality and cost. The most competitive in the market of surimi products imitated, and therefore the best in quality were the crab sticks manufactured by TM “VICI”, TM “Krab Krabych” and TM “Premium”. The developed method and the studied indicators of quality and competitiveness make it possible to use them in forming the range of products in retail trade. Keywords: surimi products, quality assessment, competitiveness, quality index, retail price, prototype, competing product. REFERENCES 1. Blonska, V. I., Depa, N. T. (2010). Porivnialna kharakterystyka metodiv otsinky konkurentospromozhnosti produktsii Naukovyi visnyk NLTU Ukrainy. 20.15, 115–120. 2. Yudin, M. (2010). Porivnialna kharakterystyka metodiv otsinky konkurentospromozhnosti produktsii Ekonomist. 6, 40–42. 3. Klymenko, S. M., Dubrova, O. S., Barabas D. O. (2006). Upravlinnia konkurentospromozhnistiu pidpryiemstva. – Kiev : KNEU. 4. Treshchov, M. M. (2009). Metody otsiniuvannia konkurentospromozhnosti produktsii Ekonomichnyi prostir. 23 (1), 118–126. 5. Pambuk, S. A. (2015). Problemy yakosti zamorozhenykh moreproduktiv, shcho predstavleni na suchasnomu rynku Ukrayiny Naukovi pratsi ONAKHT. 6, 60–63. 6. Ustenko, I. A., Mardar, M. R., Pambuk, S. A. .(2015). Marketynhovi doslidzhennya rynku produktsiyi iz surimi Ahrosvit. 9, 37–43. 7. DSTU 5097. (2009). Produktsiya iz surmi imitovana. Tekhnichni umovy : – K.: Derzhspazhivstandart Ukrainy. Natsionalʹnyy standart Ukrayiny. 8. DSTU ISO 4121 (ISO 4121:2003, IDT). (2010).Doslidzhennia sensorne. Nastanovy shchodo zastosuvannia shkal kilkisnykh reaktsii : – K.: Derzhspazhivstandart Ukrainy. Natsionalʹnyy standart Ukrayiny. Published : 2020-05-12

An Analysis of Determinants of Agricultural Product Export Using Export Functions

Under the economic environment centering on the WTO and FTA, global markets are opening at an accelerated pace under a dynamic economic environment, and the agricultural sector is no exception. Due to changes in the market environment, Korea’s exports of agricultural products are also increasing. Exports of agricultural products were only US$300 million in 1971, but this figure soared to US$3.5 billion in 1995, and as a result of aggressive expansion strategies, exports of agricultural products rose to US$9.2 billion in 2017. In this study, we analyzed the factors that determine the exports of agricultural products in Korea. Under an environment in which the structure of the agricultural markets are changing due to globalization, localization, emergence of emerging export countries, changes in income structure, and increased interest in health food. This study extracted import and export data from KATI and estimated export function of agricultural products in Korea by using panel analysis method using STATA 15 version. The countries which 15 countries with high export performance subject to analysis were limited to those exporting more than US$100 million of farm products and those exporting more than US$300 million of farm products, and the total export function was estimated at the same time. According to the analysis results, the factors affecting the nation’s agricultural exports are GDP and the signing of FTAs, each of which is statistically significant at a significance level of 1%. An analysis of countries exporting more than US$300 million showed significant results in terms of per capita national income (PGDP) and relative prices over a significant range. As a result, the analysis of the countries where the nation’s agricultural exports are high showed that the economic scale of other countries, per capita income, relative price index, and FTA agreements in force are the main factors of the expansion of Korea’s agricultural product export.

Thermo-Economic Optimization of an Idealized Solar Tower Power Plant Combined with MED System.

Based on the reversible heat engine model, theoretical analysis is carried out for economic performance of a solar tower power plant (STPP) combined with multi-effect desalination (MED). Taking total revenue of the output power and the fresh water yield per unit investment cost as the economic objective function, the most economical working condition of the system is given by analyzing the influence of the system investment composition, the receiver operating temperature, the concentration ratio, the efficiency of the endoreversible heat engine, and the relative water price on the economic parameters of the system. The variation curves of the economic objective function are given out when the main parameter is changed. The results show that the ratio of water price to electricity price, or relative price index, has a significant impact on system economy. When the water price is relatively low, with the effect numbers of the desalination system increasing, and the economic efficiency of the overall system worsens. Only when the price of fresh water rises to a certain value does it make sense to increase the effect. Additionally, the threshold of the fresh water price to the electricity price ratio is 0.22. Under the conditions of the current price index and the heliostat (or reflector), the cost ratio and the system economy can be maximized by selecting the optimum receiver temperature, the endoreversible heat engine efficiency, and the optimum concentration ratio. Given the receiver surface temperature and the endoreversible heat engine efficiency, increasing the system concentration ratio of the heliostat will be in favor of the system economy.

Is health care infected by Baumol's cost disease? Test of a new model.

Rising health care costs are a policy concern across the Organisation for Economic Co-operation and Development, and relatively little consensus exists concerning their causes. One explanation that has received revived attention is Baumol's cost disease (BCD). However, developing a theoretically appropriate test of BCD has been a challenge. In this paper, we construct a 2-sector model firmly based on Baumol's axioms. We then derive several testable propositions. In particular, the model predicts that (a) the share of total labor employed in the health care sector and (b) the relative price index of the health and non-health care sectors should both be positively related to economy-wide productivity. The model also predicts that (c) the share of labor in the health sector will be negatively related and (d) the ratio of prices in the health and non-health sectors unrelated, to the demand for non-health services. Using annual data from 28 Organisation for Economic Co-operation and Development countries over the years 1995-2016 and from 14U.S. industry groups over the years 1947-2015, we find little evidence to support the predictions of BCD once we address spurious correlation due to coincident trending and other econometric issues.

ECONOMETRIC ANALYSIS FOR TOURISM DEMAND FUNCTION IN EGYPT A DYNAMIC PANEL DATA APPROACH

In this paper, the author investigates the tourism demand function using the dynamic panel data approach in the case of Egypt. The panel data set covers the time period between 1995 and 2014. The individuals are 49 countries as origin countries for tourists, representing 92% of the total tourist arrivals to Egypt. Explanatory variables which affect the tourism demand function were taken into account: lag of dependent variable that leads to dynamic panel data approach, using DIFF-GMM estimator proposed by Arellano and Bond (1991); also, many other explanatory variables like GDP per capita, relative price index, distance, and dummy variable which represent the political situation. One of the important and significant conclusions of the paper is the significant effect of the lagged dependent variable (0.493), which may be explained as “Word of Mouth” to tourists’ decision when choosing the destination.

Inter-Region Relative Price Convergence in Korea

This paper examines the persistence of relative consumer price indices for 15 regions in Korea including 6 metropolitan cities and 9 provinces over the period of 1990-2016. In particular, we ask if relative regional price indices contain a common stochastic trend and find that they are not. We then investigate how quickly these relative prices converge to their long run value and find that a half-life of a deviation from the long run value is in the range of 13 to 22 months for the aggregate consumer price indices and in the range of 7 to 13 months for the tradable goods price indices, which is much quicker than the estimates of previous studies. These estimates suggest that existing monetary models with the realistic duration of price rigidities can generate the persistence in relative price indices.

Inter-Region Relative Price Convergence in Korea

This paper examines the persistence of relative consumer price indices for 15 regions in Korea including 6 metropolitan cities and 9 provinces over the period of 1990-2016. In particular, we ask if relative regional price indices contain a common stochastic trend and find that they are not. We then investigate how quickly these relative prices converge to their long run value and find that a half-life of a deviation from the long run value is in the range of 13 to 22 months for the aggregate consumer price indices and in the range of 7 to 13 months for the tradable goods price indices, which is much quicker than the estimates of previous studies. These estimates suggest that existing monetary models with the realistic duration of price rigidities can generate the persistence in relative price indices.