aidsPx function

Price Index for the AIDS

Calculate log price indices for the AIDS and LA-AIDS.

aidsPx( priceIndex, priceNames, data, shareNames = NULL, base = 1, coef = NULL,
      shifterNames = NULL )

Arguments

• priceIndex: the price index to be used (see details).
• priceNames: a vector of strings containing the names of the prices.
• data: a data frame containing the required variables.
• shareNames: a vector of strings containing the names of the expenditure shares.
• base: the base to calculate the indices (see details).
• coef: a list containing the coefficients alpha0, alpha, beta, and gamma (only needed for the translog price index).
• shifterNames: an optional vector of strings containing the names of the demand shifters that modify the alphas of the Translog price index.

Details

Currently 7 different price indices are implemented:

• translog price index ('TL'),
• Stone price index ('S'),
• Stone price index with lagged shares ('SL'),
• loglinear analogue to the Paasche price index ('P'),
• loglinear analogue of the Laspeyres price index ('L'),
• simplified loglinear analogue of the Laspeyres price index ('Ls'), and
• Tornqvist price index ('T').

The argument base can be either

• a single number: the row number of the base prices and quantities,

• a vector indicating several observations: The means of these observations are used as base prices and quantities, or

• a logical vector with the same length as the data: The means of the observations indicated as 'TRUE' are used as base prices and quantities.

• a list with elements prices and/or shares

  that are numeric vectors specifying the values of the base prices and/or base expenditure shares.

Returns

A vector containing the log price index. If argument priceIndex is "P", "Ls", or "T", the returned vector has the attribute(s) basePrices and/or baseShares

that are numeric vectors of the base prices and/or base expenditure shares for calculating the price indices.

References

Deaton, A.S. and J. Muellbauer (1980) An Almost Ideal Demand System. American Economic Review, 70, p. 312-326.

Moschini, G. (1995) Units of Measurement and the Stone Index in Demand System Estimation. American Journal of Agricultural Economics, 77, p. 63-68.

Author(s)

Arne Henningsen

See Also

aidsEst

Examples

data( Blanciforti86 )

   # Stone price index
   aidsPx( "S", c( "pFood1", "pFood2", "pFood3", "pFood4" ),
      Blanciforti86, c( "wFood1", "wFood2", "wFood3", "wFood4" ) )

   # (log-linear analogue of the) Paasche price index
   aidsPx( "P", c( "pFood1", "pFood2", "pFood3", "pFood4" ),
      Blanciforti86, c( "wFood1", "wFood2", "wFood3", "wFood4" ),
      base = row.names(Blanciforti86) == "1970" )

   # Tornqvist price index
   aidsPx( "T", c( "pFood1", "pFood2", "pFood3", "pFood4" ),
      Blanciforti86, c( "wFood1", "wFood2", "wFood3", "wFood4" ),
      base = list( prices = rep( 100, 4 ), shares = rep( 0.25, 4 ) ) )