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Methodology and application of price analysis

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Summary

This paper deals with the relationship between the development of unit costs and prices of production factors and the development of the prices of final products. The investigation of these relationships during the various stages of production in the economic process, an activity called price analysis, may contribute to the analysis of inflation. In this respect the influence of the wage rate on the development of the prices of final expenditure is more considerable than the influence of the prices of imports of goods and services. However, taking into account the modifications in the structure of production, particularly regarding labour productivity and import substitution, the main explanation of the price increase in 1976 compared with 1970 of three categories of final expenditure,viz. exports of goods and services, private consumption expenditure and gross fixed capital formation of enterprises is to be found in the unit costs of imports of goods and services rather than in the unit labour costs.

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Authors and Affiliations

  1. Netherlands Central Bureau of Statistics, The Netherlands

    H. W. J. Donkers

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  1. H. W. J. Donkers
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An earlier version of this paper was presented at the 17th General Conference of the International Association for Research in Income and Wealth, Gouvieux, France, August 17–22, 1981. The author thanks C.B.S. staff members for many fruitful discussions and he is grateful to a referee for his helpful comments.

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Donkers, H.W.J. Methodology and application of price analysis. De Economist 130, 336–359 (1982). https://doi.org/10.1007/BF02371746

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  • DOI: https://doi.org/10.1007/BF02371746

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