Aggregation methods for intercountry comparisons of prices and real values in agriculture: A review and synthesis

This paper considers alternative approaches to providing consistent intercountry comparisons of prices, quantities and productivity in the agricultural sector. Bilateral index numbers allow price and quantity comparisons between two countries, whereas multilateral indexes make it possible to construct real values, purchasing-power parities (PPPs) and productivity indexes across a larger number of countries at a given point in time. We describe the empirical and theoretical properties of the most common index numbers. We then examine how empirical results are affected by applying the...

This paper considers alternative approaches to providing consistent intercountry comparisons of prices, quantities and productivity in the agricultural sector. Bilateral index numbers allow price and quantity comparisons between two countries, whereas multilateral indexes make it possible to construct real values, purchasing-power parities (PPPs) and productivity indexes across a larger number of countries at a given point in time. We describe the empirical and theoretical properties of the most common index numbers. We then examine how empirical results are affected by applying the different multilateral approaches to compare the real agricultural output of ten European countries and the United States. We provide a set of PPPs for agricultural output which can be used for comparing real agricultural output aggregates.