William Wasserman

An Experimental Comparison Between Fixed Weight and Linear Programming Food Price Indexes

Abstract A linear programming food price index permits the possibility of routine substitutions in response to price changes, while a fixed weight index does not. This paper cites a variety of evidence indicating that consumers do trade off among foods in response to both long-term and seasonal price changes. Implications of this for food price indexes are discussed. A linear programming food price index is then developed, based on an empirical menu-planning model, and compared with corresponding fixed weight price indexes over a nine-month period. The linear programming index shows a significantly smaller increase in food prices over the nine-month period than the fixed weight index with initial period weights.

Potentials in Applying Linear Programming to the Consumer Price Index

Abstract The Stigler Committee Report [20, 21, 22] has stressed the desirability of revising the Consumer Price Index in the direction of a fixed-utility cost-of-living index. This paper proposes that a linear programming approach might be feasible for developing the food component price index of a cost-of-living index, and perhaps also for some other components. The main advantage of the linear programming approach would be that it recognizes substitutions among goods and services as prices change, whereas the conventional fixed market-basket approach to the formulation of index numbers makes no provision for such trading off of commodities and services.

The Teaching and Use of Statistics in Turkey

In the teaching and use of statistics, as in much else in Turkey, the most significant facts (and frequently the most encouraging ones) relate not to current status but rather to the nature of the changes taking place. For the most part persons in government, industry, and the sciences have as yet no knowledge of the potentialities of statistical methods. In many activities veritable dossiers of statistical information are assembled, but the disparity is great between the impetus to collect figures and the ability to use them. It is not possible to obtain a degree in statistics anywhere in the Turkish educational system. In many subject matter areas where statistical methods can be applied with great benefit there is still not a course in statistics in the curriculum. In other areas there are courses which are very much out of date.