Do Unit Value Export, Import, and Terms of Trade Indices Represent or Misrepresent Price Indices?

Author/Editor:

Mick Silver

Publication Date:

May 1, 2007

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

Unit value export and import indices compiled from returns to customs authorities are often used as surrogates for price indices in the measurement of inflation transmission, terms of trade (effects), and to deflate import and export value series to derive volume series. Their widespread use is mainly due to their relatively low cost compared with establishment price surveys. This paper provides evidence of substantial bias in their representation of such price changes. Their continued use would mislead economic analysis. The paper considers the efficacy of alternative strategies for their improvement, and argues for a move to establishment-based price surveys.

Series:

Working Paper No. 2007/121

Subject:

Exports Import price indexes Imports Price indexes Terms of trade

English

Publication Date:

May 1, 2007

ISBN/ISSN:

9781451866858/1018-5941

Stock No:

WPIEA2007121

Pages:

34

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