Minding Your Ps and Qs: Going from Micro to Macro in Measuring Prices and Quantities
AbstractKey macro indicators such as output, productivity, and inflation are based on a complex system across multiple statistical agencies using different samples and levels of aggregation. The Census Bureau collects nominal sales, the Bureau of Labor Statistics collects prices, and the Bureau of Economic Analysis constructs nominal and real GDP using these data and other sources. The price and quantity data are integrated at a high level of aggregation. This paper explores alternative methods for reengineering key national output and price indices using item-level data. Such reengineering offers the promise of greatly improved key economic indicators along many dimensions.
CitationEhrlich, Gabriel, John Haltiwanger, Ron Jarmin, David Johnson, and Matthew D. Shapiro. 2019. "Minding Your Ps and Qs: Going from Micro to Macro in Measuring Prices and Quantities." AEA Papers and Proceedings, 109: 438-43. DOI: 10.1257/pandp.20191004
- C43 Index Numbers and Aggregation; Leading indicators
- E20 Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy: General (includes Measurement and Data)
- E30 Prices, Business Fluctuations, and Cycles: General (includes Measurement and Data)