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Broda and Weinstein (2005) write: "As explained in Sato (1976), a price index
P that is dual to a quantum index, Q, in the sense that PQ=E and shares and
identical weighting formula with Q is defined as 'ideal'. Fischer (1922) was
the first to use the term ideal to characterize a price index. He noted that
the geometric mean of the Paasche and Laspayres indices is ideal."
E there probably stands for expenditure.
Quantum probably means quantity.
Laspayres is the same as Laspeyres.
[Ed: I infer that the Paasche and Laspeyres indexes are not themselves
ideal.]
Source: Broda and Weinstein. 2005. Globalization and the gains from variety.
Aug 2005 working paper. especially circa p.14;
Diewert, W. Erwin. 1976. Exact and Superlative Index Numbers. Journal of
Econometrics. pp. 115-145.
Sato, Kazuo. 1976. The ideal log-change index number. Review of Economics
and Statistics. pp. 223-8.
Vartia, Yrjo. 1976. Ideal log-change index numbers. Scandinavian Journal of
Statistics. pp. 121-126.
Contexts: demand; estimation
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