The production approach 2 to the calculation of nominal GDP involves calculating the value of outputs produced by an industry and subtracting the value of intermediate inputs (or intermediate consumption to use the national accounting term) used in the industry. This difference in value is called the industry’s value added. Summing these industry estimates of value added leads to an estimate of...

Reference price systems for prescription drugs constitute widely adopted cost containment tools. Under these regimes, patients co-pay a fraction of the difference between a drug's pharmacy retail price and a reference price that is set by the government. Reference prices are either externally (based on drug prices in other countries) or internally (based on domestic drug prices) determined. We ...

The Fair Trade coffee initiative attempts to channel charity from consumers to poor producers via increased prices. Though widely heralded, we show that the rules of the Fair Trade system permit complete arbitraging away of rents due to costly excess certification of output. Using data from an association of coffee cooperatives in Central America, we verify that arbitrage on this margin causes ...

Monthly price and stock data are used to test the influence of Philippine government buffer-stock programs on seasonal and annual variability of producer and consumer rice prices. The period examined is 1974-1990. NFA stock changes are shown to have had some stabilizing influence on seasonal and annual price changes, but the magnitude is small and not statistically significant.

The introduction of electronic means of sale and dissemination of information goods has made a new set of pricing and bundling strategies possible. In particular, information goods have a negligible marginal cost. This provides producers with an incentive to sell goods in bundles. This new space of strategies also presents producers with a set of problems to solve. In most cases, a producer wil...

Over the past 40 years economists have devoted considerable effort to estimating long-run trends in real commodity prices. The results indicate that the real prices for many commodities have fallen, suggesting to the surprise of many that resource scarcity is declining over time. Almost all of this work, however, uses the U.S. producer price index or other standard price deflators, which recent...

In this paper we examine the degree of market integration in French gas imports. Are there substantial price differences between gas from different export countries, and do prices move together? Furthermore, we analyze to what extent the French, German and Belgian markets are integrated. The long-term takeor-pay contracts are described and analyzed. Time series of Norwegian, Dutch and Russian g...