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  • May 2018
  • Article
  • AEA Papers and Proceedings

Using Online Prices for Measuring Real Consumption Across Countries

By: Alberto Cavallo, Erwin Diewert, Robert C. Feenstra, Robert Inklaar and Marcel P. Timmer
  • Format:Print
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Abstract

We show that online prices can be used to construct quarterly purchasing power parities (PPPs) with a closely matched set of goods and identical methodologies in a variety of developed and developing countries. Our results are close to those reported by the International Comparisons Program (ICP) in 2011 and the OECD in 2014 and can be used to obtain more up-to-date estimates of real consumption across countries without the need for consumer price index extrapolations. We discuss advantages and limitations associated with the use of online prices for PPPs, including issues of representativeness and limited coverage of product categories and countries.

Keywords

Purchasing Power Parity; International Economy; Online Prices; Billion Prices Project; Economics; Macroeconomics; Price; Internet and the Web; Spending; Economy; Global Range; Measurement and Metrics

Citation

Cavallo, Alberto, Erwin Diewert, Robert C. Feenstra, Robert Inklaar, and Marcel P. Timmer. "Using Online Prices for Measuring Real Consumption Across Countries." AEA Papers and Proceedings 108 (May 2018): 483–487.

Supplemental Information

NBER Digest - Summary
Short summary of the paper in the NBER's monthly newsletter.
AEA Event Webcast
The webcast for our presentation at the 2018 Annual AEA Conference
Data and Replication Files
The data and code needed to replicate the results in this paper are available on Harvard University's Dataverse
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About The Author

Alberto F. Cavallo

Business, Government and the International Economy
→More Publications

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