During recent years, several empirical studies have found that deviations from labour values to market prices are quite small. However, most of these articles do not offer a detailed reason for this ...result. In this paper two theoretical justifications of the labour theory of value are brought together with some data concerning labour values, prices of production and market prices, on the basis of German input-output tables from 2000 and 2004. In addition, the statistical characteristics of profit rates are analysed. Both of the theoretical arguments are much in line with the empirical observations, because there is only a slight transformation tendency and at the same time profit rates and capital intensity are negatively correlated. Moreover, during the period under observation the German economy seems to be in a state of statistical equilibrium.
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•We consider whether direct–market prices deviations persist over time after a shock.•The persistence of production–market prices deviations after shocks is analyzed.•We consider 5 countries and 3 ...different computation approaches.•We adopt various econometric methods.•Persistence is found to be high.
The present paper explores the persistence of the deviations between market prices on one side and either production or direct prices on the other – namely their tendency to vanish after being hit by a shock. We consider various countries – Austria, Denmark, Italy, Norway, Japan and the US – across different time periods, econometric approaches and methods of computing direct and production prices. Results can change depending on these methods, but even the weakest results would point to price–price deviations taking 5 years to shrink by one half after a shock. The strongest results, instead, show no tendency of price–price deviations to disappear.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UL, UM, UPUK
This paper examines the effects of decoupling policies on Greek cotton production with the hypothesis that producers face uncertainty regarding output prices. The authors simulate the effects on ...cotton production under four contrasting policy scenarios: an ‘old’ Common Agricultural Policy (CAP) regime (that is, the policy practised until 2005), a Mid-Term Review regime, a fully decoupled policy regime and a free trade–no policy scenario. The results show that, when farmers are less risk-averse, production gradually decreases as farmers' support becomes decoupled from production. On the other hand, when farmers are more risk-averse, the opposite occurs. Moreover, the fully decoupled payment policy is found not to be production-neutral, since it indirectly affects producers' decisions through the ‘wealth effect’.
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Consumers incur many transaction costs in purchasing and using most products. This paper examines the effects of a reduction in such consumer transaction costs caused by market-level technological ...advances. Using a model in which consumers are simultaneously heterogeneous in their transaction costs and in their marginal valuations of product quality, this paper highlights two mechanisms that can cause such reductions in consumer transaction costs to lower consumer surplus and reduce consumer share of the total social surplus. Specifically, market-level technological advances reduce different consumers' transaction costs by different amounts and increase their reservation prices by different amounts, which can lead to: (i) product design changes that many current consumers do not like and (ii) homogenization in consumer reservation prices that allows a seller to extract more surplus through its pricing policy. This paper also shows that consumers may be better off with seller-induced higher consumer transaction costs. Finally, the paper shows how, depending on the nature of the quality production process, such reductions in consumer transaction costs can either lower or raise product qualities and consumer prices.
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An increase in the price of imported fossil fuels indirectly increases the producer price in non-energy sectors; however, this indirect influence cannot be taken into account by the traditional ...portfolio approach. This study proposes an analytical framework combining the input–output (I–O) model and the portfolio approach that can take the indirect influence into account. A risk of an increase in the producer price in Japanese non-energy sectors during the period 1970–2000 is estimated, and the causes of a decrease in the risk through the analysis period are clarified by decomposing an index of the risk. The result indicates that almost all non-energy sectors have decreased this risk during the analysis period. The degree and cause of the decrease depends on a sector’s location in the hierarchical structure of Japanese industries. For example, assembly sectors have decreased their risk mainly as the result of improvement in energy usage by upstream sectors, such as material sectors, rather than their own improvements. Proper policies considering such a structure are required to decrease the risk further because the effort taken to do so is seldom motivated by economic profit.
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We document producer price adjustment using a low-inflation micro price dataset. On average 24% of prices adjust each month, with an average increase/decrease of 6%. Producer prices adjust more ...frequently than consumer prices, but their size of adjustment is typically smaller. Sectoral heterogeneity in the frequency of price adjustment is strongly related to heterogeneity in the cost structure. Fluctuations in aggregate producer price inflation occur to a large extent through variation in the relative share of upward and downward price adjustment.
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This study investigates causal relationships between consumer and producer inflation. In so doing, it makes the following contributions to the literature. First, the methodology allows causality ...testing within a bivariate system, with other important variables included in the system. Second, the analysis is based on a model chosen out of three other competing models. The models consider the possibility of both symmetric and asymmetric responses to demand and supply shock inflationary situations. This approach differs from the traditional Engle-Granger (EG) approach, which implicitly assumes symmetric adjustment towards equilibrium (Enders and Siklos,
2001
). Third, causality testing is conducted within an error correction framework to handle possible inferential biases resulting from invalid asymptotic critical values. The chosen model was used to conduct short- and long-run causality tests within a framework that takes into account differentiated responses to changes in inflation regimes. The following are major findings of this study: There exists dynamic relationship between producer and consumer prices, characterized by unidirectional causality running from producer to consumer inflation. On the issue of asymmetric responses, it is found that consumer inflation reacts differently to positive and negative trends in producer inflation. In other words, consumer price rises faster than it falls.
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Este artigo examina o estatuto metodológico da transformação de valores em preços. Para tanto, resgata a evolução da dialética, que se tornou método com Platão, assumiu a forma de sistema de ...demonstrações necessárias que partem dos princípios incondicionados alcançados através da synagoge com Aristóteles e de lógica do Espírito Absoluto com Hegel. Invertendo a dialética hegeliana, Marx concebe a dialética como a lógica da realidade objetiva reproduzida pela razão. Em particular, na dialética de O Capital, mostra como, na sequência do desdobramento da mercadoria, ponto de partida da exposição (Darstellung) do capitalismo, a transformação dos valores em preços surge necessariamente como o momento do aparecer da essência do capitalismo (o trabalho abstrato) no âmbito do fenômeno. Com os preços de produção, encerra-se a explicação racional da realidade efetiva (Wirklichtkeit), concebida como emergência da essência ao nível do fenômeno, englobando o âmbito da acidentalidade, inescapável em toda ciência empírica.This article examines the methodological statute of the transformation of values into prices. It resumes the evolution of dialectics, which became method with Plato, assumed the form of a system of necessary demonstrations which stem from the unconditioned principles reached through the synagogue with Aristotle and the logic of the Absolute Spirit with Hegel. Inverting the Hegelian reasoning, Marx conceives dialectics as the logic of objective reality that is reproduced by reason. In The Capital, Marx shows how in the unfolding of the commodity - point of departure of the exposition (Darstellung) of capitalism - it necessarily emerges the transformation process, as the moment of the essence's blossoming (the abstract labor) in the domain of the phenomenon. With the prices of production, the rational explanation of effective reality (Wirklichtkeit) is complete, conceived as emergence of the essence at the level of the phenomenon, encompassing the sphere of accidentality, inescapable in every empiric science.
This paper estimates the degree of exchange rate pass-through (ERPT) into import prices for Central Asia countries over period 1995q11-2012q11 years. The additional study was done for Kazakhstan to ...determine the impact of money regulating policy into short-run and long-run ERPT. The study of ERPT was done by employing cointegration analysis across five central Asia countries: Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. The paper analyzes three opportunities of the transmission of the export cost into ERPT using production price indices (PPI) of three major trading partners of Central Asia countries: PPI of Russia, PPI of Turkey and PPI of China. In case with PPI of Russia the results showed, that ERPT is extended beyond of 1 for Kazakhstan and Kyrgyzstan. Incomplete ERPT is indicated for Tajikistan and Turkmenistan, and zero ERPT is indicated for Uzbekistan. In case with PPI of Turkey, the elasticities of extent ERPT into import prices are more higher then in case with PPI of Russia, and elasticities for all Central Asia countries are negative and significant. In case with PPI of China, incomplete ERPT is indicated for all Central Asia countries, except the Kyrgyzstan, which has extended ERPT. In all cases this study showed the significance of ERPT, except only two cases for Kazakhstan and Tajikistan with PPI of China. Also interesting, those elasticities of ERPT with PPI of China are lower comparing with other cases. In the special study of money regulation policy only for Kazakhstan the short-run and long-run elasticities of ERPT are incomplete with PPI of Russia and PPI of Turkey, and they are extended with PPI of China.
This paper examines the joint pricing decision of products in a firm's product line. When products are distinguished by a vertical characteristic, those with higher values of that characteristic will ...command higher prices. We investigate whether, holding the value of the characteristic constant, there is an additional price premium for products on the industry and/or the firm frontier, that is, for the products with the highest value of the characteristic in the market or in a firm's product line. We also investigate the existence of price premia for lower-ranked products and other product line pricing questions. Using personal computer price data, we show that prices decline with the distance from the industry and firm frontiers, even after holding absolute quality constant. We find evidence that consumer tastes for brands is stronger for the consumers of frontier products (and thus competition between firms weaker in the top end of the market). There is also evidence that a product's price is higher if a firm offers products with the immediately faster and immediately slower computer chip (holding the total number of a firm's offerings constant), possibly as an attempt to reduce cannibalization. Finally, a product's price declines with the time it is offered by a firm, suggesting intertemporal price discrimination. Ce mémoire examine la décision conjointe de tarification des produits dans la ligne de produits d'une firme. Quand les produits se distinguent par une caractéristique verticale, ceux qui ont de plus grandes valeurs pour cette caractéristique commanderont de plus forts prix. On se demande si, gardant la valeur de cette caractéristique constante, il y a une prime additionnelle des prix pour les produits de l'industrie ou pour les produits de pointe de la firme (i.e., les produits avec la plus haute valeur de cette caractéristique dans le marché ou dans la ligne de produits de la firme). On examine aussi s'il existe une prime de prix pour les produits qui se classent moins bien ou d'autres questions sur la tarification des lignes de produits. En utilisant des données de prix pour les ordinateurs personnels, on montre que les prix chutent à mesure qu'on s'éloigne de la frontière des produits de pointe pour l'industrie et la firme, même si on garde la qualité absolue constante. Les résultats montrent que le goût des consommateurs pour les marques est plus fort pour les consommateurs des produits de pointe (et que la concurrence entre firmes est plus faible dans cette section du marché). On montre aussi que le prix d'un produit est plus élevé si une firme offre des produits avec une puce juste plus rapide et plus lente (tout en gardant le nombre total de produits de la firme constant) possiblement dans un effort pour réduire la cannibalisation. Enfin, le prix d'un produit décline à proportion que la période de temps où il est offert par une firme s'allonge, ce qui suggère qu'il y a discrimination intertemporelle par les prix.
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