Drift in Producer Price Indexes for the Former Soviet Union (FSU) Countries

13 Pages Posted: 15 Feb 2006

See all articles by François Lequiller

François Lequiller

affiliation not provided to SSRN

Kimberly Zieschang

International Monetary Fund (IMF) - Statistics Department

Date Written: March 1994

Abstract

The purpose of this paper is to show that, under the price fluctuations that characterize most transition economies, the commonly used chain index derived from the published month-to-month price change of the PPI in some cases dramatically overstates the rate of price inflation. The analysis is based in part on a seminal paper by Szulc, who studies the problem of drift for a wide class of index formulae, and in part on the observations of price movements made by the Fund`s missions. Greatest during the year 1992, the drift declines with slower rates of inflation and, possibly, with changing patterns of price increases, but is still important for countries such as Russia, where monthly inflation continues to run well into the double digits.

JEL Classification: C43, C82, E31

Suggested Citation

Lequiller, François and Zieschang, Kimberly, Drift in Producer Price Indexes for the Former Soviet Union (FSU) Countries (March 1994). IMF Working Paper No. 94/35, Available at SSRN: https://ssrn.com/abstract=883485

François Lequiller (Contact Author)

affiliation not provided to SSRN

No Address Available

Kimberly Zieschang

International Monetary Fund (IMF) - Statistics Department ( email )

700 19th Street, N.W.
Washington, DC 20431
United States