Using the Retail Distribution of Sellers to Impute Expenditure Shares
AbstractMany price indices must be constructed without quantity data at the elementary level. The paper shows that for some consumer goods in the United States and other countries, one can approximate expenditure shares using weights derived from the retail distribution of sellers. These weights are based on the share of outlets selling an item, or the share of outlets adjusted by the total number of items sold in each. Relative to using no weights, the paper finds that using such imputed weights substantially reduces bias in the frequency of price changes, in annual inflation, and in price comparisons across countries.
CitationAntoniades, Alexis, Robert C. Feenstra, and Mingzhi (Jimmy) Xu. 2022. "Using the Retail Distribution of Sellers to Impute Expenditure Shares." American Economic Review, 112 (7): 2213-36. DOI: 10.1257/aer.20190896
- E31 Price Level; Inflation; Deflation
- L11 Production, Pricing, and Market Structure; Size Distribution of Firms
- L81 Retail and Wholesale Trade; e-Commerce
- O11 Macroeconomic Analyses of Economic Development
- O14 Industrialization; Manufacturing and Service Industries; Choice of Technology