Showing papers on "Purchasing power published in 1976"

The Purchasing Power Fund: A New Kind of Financial Intermediary

Abstract: (1976). The Purchasing Power Fund: A New Kind of Financial Intermediary. Financial Analysts Journal: Vol. 32, No. 6, pp. 49-59.

Multilateral and Bilateral Measures of Effective Exchange Rates in a World Model of Traded Goods

Abstract: When the exchange rates of most of the major trading nations of the world are floating, the two-country theory of the balance of payments with traded and nontraded goods needs to be modified to take account of the multiplicity of foreign price levels for tradable goods.' This note develops the relationship between the price of traded goods in a single country and changes in exchange rates in all other countries, using a simplified version of the IMF's Multilateral Exchange Rate Model (MERM) (see Artus and Rhomberg 1973). Some notable simplifications are obtained under small-country assumptions. The standard technique for dealing with a group of floating rates is the concept of effective exchange rate (see Economic Report of the President 1974, pp. 220-26). When there are n countries floating, the movement of the dollar exchange rate may give a very inaccurate idea of real changes in the international purchasing power of any given currency. The effective exchange rate for a country can be defined as a weighted average of the exchange rates of its trading partners, with all rates being measured relative to some base year. An index can then be computed by comparing the actual exchange rate of the country with the weighted average of the rates of its trading partners. The simplest type of weighting system is a bilateral system of weights, using either export shares or import shares or an average of both. For example, an export-weighted effective rate index can be defined as in equation (1), where

(1968) Structural Inflation-Lock and Balanced Growth

Abstract: This chapter presents the issue of inflation and balanced growth. Inflation is a notoriously plurivalent term. The main differences among the current uses regard primarily the source of the inflation, its intensity, and its duration. However, the common precipitate of all these denotations is a rise in money prices consequent to an increase in the purchasing power of the community through monetary channels alone. Most economists have concentrated their attention on the inflation of a moderate intensity that has been continually going on in almost all advanced economies with a well-organized money market and a monetary circuit encompassing all economic units, with only a standard guidance of the interest rate by the central banking authority, but without any direct government controls over prices, wages, and rents. That is, the standard concern has been with the inflation that propagates itself primarily through credit expansion—whether or not accompanied by a cheap money policy of the central monetary system.

Stabilization Characteristics of Unemployment Insurance

Abstract: Determines the extent to which unemployment insurance benefits have helped maintain aggregate purchasing power during periods of economic recession. Purposes of unemployment compensation; Extensions of unemployment insurance; Automatic and formula level of benefits that can be expected from unemployment exceeding 4% in 1975 and 1976. (Abstract copyright EBSCO.)

Toward More Effective Use of School Resources.

Abstract: is abundant evidence that the problems of financing education have not yet been solved. New York City is cutting back educational and other public services in a desperate effort to avoid default. A "hold the line" attitude prevails throughout the country as school and municipal officials strive to avoid tax increases in the face of inflation which perniciously erodes the purchasing power of the dollar. Teachers strike, or threaten to, seeking salary increases which will at least keep up with inflation. Those who thought pressure on school budgets would ease as enrollments stabilized or declined have experienced the same frustration as did those who counted on a "peace dividend" when the war in Viet Nam ended. It is understandable that citizens and policy makers question the productivity of educational institutions and express concern for what they perceive to be inefficiency in the use of the resources devoted to education. For example, the chairman of one of our largest industrial concerns (and former chairman of the National Council for Educational Research), Patrick Haggerty, has pointed out that in 1970 only 4 per cent of American workers were engaged in agriculture, forestry, or fisheries compared to 40 per cent in 1890 and 20 per cent in 1930; yet the 4 per cent in 1970 were producing substantially more food and forest products than did the 40 per cent in 1890.1 Thus, productivity per person engaged in agriculture increased more than ten fold in that 80-year period. On the other hand, Haggerty pointed out that between 1930 and 1970 our population increased by about 60 per cent, our school enrollment increased by about 200 per cent, and the

The Importance of Labour-force Structure in Relation to Employment and Unemployment in Less-developed Countries

Abstract: During the past few years, the focus of most discussions on economic development has shifted from food production to poverty and unemployment. In many developing countries, the increase in the output of staple cereals like wheat, made possible by the availability of high yielding varieties of seeds responsive to chemical fertilisers under conditions of assured and controlled water-supply, has raised the welcome prospect of self-sufficiency in foodgrains, at least during normal weather conditions. However, for the non-cultivating households, work by at least the able-bodied males is the main source of purchasing power required for food consumption. The problem of providing productive employment opportunities to the growing labour force therefore assumes great importance.

Purchasing Power Risk and the Performance of Non Life Insurance Companies

Abstract: This paper examines the consequences of uncertain inflation to nonlife insurance companies. Insurers are assumed to be real return oriented. Thus they seek strategies which minimize the variance of real returns for every expected value. A model of insurance company's performance is presented in nominal and real terms and used for analysing aggregate figures of U.S. stock insurance companies. The analysis shows that uncertain inflation would tend to decrease the premium-equity ratio of insurance companies. Furthermore, it indicates that leverage-investment decisions which would seem risk-return optimal in nominal terms are likely to become non-optimal in real terms.

Central problems of economic development of the Transkei

Abstract: In this article the argument has been advanced that the economic development of the Transkei is being retarded by a number of important barriers or factors which act and re‐act upon one another in such a way as to prevent development from getting underway on a broad front. The main factor is the lack of inducement to invest, which results from the limited size of the local market on account of the low level of per capita income. The level of per capita income is determined by productivity, which in turn depends largely on the availability of capital goods as a result of past investments. In the case of the Transkei, the circular relation between the above barriers is reinforced by the high rate of population growth, the high dependency burden, outward migration, the leakage of purchasing power, the system of land tenure and traditional attitudes and practices. Provisional reference only, has been made to possible ways and means of removing the barriers and of breaking the circular relation betwee...

Middle East market

Abstract: A growing market of vast potential is the group of oil-rich countries stretching from Libya in North Africa to Iran in the east Sales of heating and air conditioning equipment have rocketed since the 1973 oil price rises, and now billions of dollars are being spent in ambitious development projects spanning the entire economic spectrum Total purchasing power on the international markets of the OPEC countries was estimated as $56 billion in 1974 and estimated to rise steeply to reach $250 billion by 1980 Middle East oil accounts for the greater part of OPEC's output and is therefore where most of the wealth will be concentrated The Middle East produces one-third of the world's oil and still has over half the total oil reserves Saudi Arabia is the largest producer in the area and is third in importance to the US and USSR The heating and air conditioning market is shared principally between Japan, US, Germany, UK, and France--roughly in that order The UK is the leading seller of knowhow--consulting engineering designs, supervision of contracts, licensing agreements, etc The value of mechanical and electrical services installations designed by UK firms in 1975 was around $500 million; at least half ofmore » this was in heating and air conditioning« less

Policies and programmes for agricultural development: the role of economic-social science analysis and of research agencies in seeking solutions

Abstract: The rapid increase in world population makes it vitally urgent to increase food production. The governments of developed and developing countries must be willing to take action not only in the face of hunger, but concentrate on long range aspects of the food problem. World food supplies are, and probably will be, distributed in accordance with purchasing power or effective demand and not according to nutritional requirements. A permanent solution to the problem includes population control and major efforts to plan agricultural research directed toward a long term solution of the agricultural production and food supply problem, particularly in those climatic zones where very little research has been historically undertaken.

ALFIN, an experiment in adult literacy training in a society in transition

Abstract: Publisher Summary This chapter discusses ALFIN, an experiment in adult literacy training in a society in transition. The industrial sector, founded on the single model, which has been called industrialization by substitution, began to develop considerably from 1950 on. Its share of GNP grew rapidly, and it eventually overtook agriculture as the country's number one activity. However, the impact of industry in absorbing available labor was only slight; it was producing for a narrow market with low purchasing power and the technology employed created few jobs while calling for imported producer goods. The concentration of ownership of property, therefore, determined the concentration of wealth and, hence, the concentration of political power. In January 1972, the Ministry of Education set up an Adult Education Commission (CEA) under the chairmanship of Dr. Augusto Salazar Bondy, who was also Chairman of the Higher Council for Education, the Ministry's supreme consultative body. Among other functions, the CEA was briefed to plan adult education activities and to supervise the application of this plan once formulated; through the Permanent Office of Education Co-ordination (JUPCE), the CEA was responsible for the coordination of the Ministry of Education's activities with those of other State bodies and sectors, and was also responsible for cooperating with various approaches to ensure the financing of projects.

The Differential Impact of Food Inflation upon the Poor

Abstract: The poor spend a larger percentage of their incomes on food, and thus food inflation affects the poor more than higher income groups. A price index for foods purchased by the poor based on data gathered in Atlanta, Georgia-a fairly representative metropolitan area-is presented. It suggests that the cost of living of the poor during recent periods has been differentially affected by a larger increase in the price of their weighted food market basket compared to the increase in the average consumer's food market basket. A measure is also given of the degree to which food stamps failed to maintain constant purchasing power in Atlanta because of the rapid price changes.