This setting lets you change the way you view articles. You can choose to have articles open in a dialog window, a new tab, or directly in the same window.
Open in Dialog
Open in New Tab
Open in same window

American Economic Review: Vol. 94 No. 5 (December 2004)

AER Volume. 94, Issue 5 | leftPrevious ArticleNext Articleright

Expand

Quick Tools:

Print Article Summary Email Link to this Article Export Citation
Sign up for Email Alerts Follow us on Twitter

Explore:

AER - All Issues

AER Forthcoming Articles

Rationalizing the Penn World Table: True Multilateral Indices for International Comparisons of Real Income

Article Citation

Neary, J Peter. 2004. "Rationalizing the Penn World Table: True Multilateral Indices for International Comparisons of Real Income." The American Economic Review, 94(5): 1411-1428.

DOI: 10.1257/0002828043052286

Abstract

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.

Article Full-Text Access

Full-text Article

Additional Materials

Download Data Set (31.38 KB) | Link to Appendix (114.54 KB)

Authors

Neary, J. Peter


American Economic Review



AEA Member Login:


Quick Tools:

Email Link to this Issue

Sign up for Email Alerts

Follow us on Twitter

Subscription Information
(Institutional Administrator Access)

Explore:

AER - Forthcoming Articles

AEA Journals

Virtual Field Journals

AEAweb | AEA Journals | Contact Us