Measuring Service Prices of U.S. Manufacturing Capital Input, Inventories, and Financial Working Capital, 1947–1981

Article type: Research Article

Authors: Nguyen, Sang V.^{a; *} | Andrews, Stephen H.^a

Affiliations: [a] U.S. Bureau of the Census

Correspondence: [*] Address correspondence to Sang V. Nguyen, Center for Economic Studies, Bureau of the Census, U.S. Department of Commerce, Washington, D.C. 20233.

Abstract: In this paper, we construct and compare various service price indexes of capital input, inventories, and financial working capital, using complete sets of variants of the Jorgensonian user cost formula. We demonstrate that variations in the construction of the series yield substantially different results. We also find that proper measures of service prices should incorporate a complete set of variables suggested by economic theory. In addition, Divisia indexes of financial working capital and its service price are superior to the direct aggregates.

DOI: 10.3233/JEM-1986-14406

Journal: Journal of Economic and Social Measurement, vol. 14, no. 4, pp. 325-340, 1986