Purchasing power

About: Purchasing power is a research topic. Over the lifetime, 2714 publications have been published within this topic receiving 36866 citations. The topic is also known as: adjusted for inflation.

Rubles for Victory: The Social Dynamics of State Fundraising on the Soviet Home Front

Abstract: A point of pride in the Soviet Union was that its people paid for an entire year of the Great Patriotic War. In one historian's estimate, around 388 million rubles were spent each day for a total of 1,418 days; taken together, revenues from war bonds, lotteries, and citizens' cash donations totaled about the cost of one year's expenditures. (1) In Soviet workplaces, war bonds and lottery tickets not only sold out but were oversubscribed, usually within days and sometimes within mere hours. In December 1942, an elderly beekeeper named Ferapont Golovatyi allegedly arrived at his local party committee, carrying a bag containing 100,000 rubles for the purchase of a fighter plane. (2) Following in his footsteps, collective farmers rounded up billions of rubles to purchase aircraft, tanks, and other weapons for the defense of Stalingrad, which bore their names, messages to soldiers, and socialist slogans into battle. The enormity of these contributions is striking. No less striking is the fact that they poured in at a time when Soviet money had become nearly worthless but was still desperately needed. To pay for the war, the Soviet government turned to the printing press: by 1 January 1946, there were 69 billion rubles in circulation, up from just 18.4 billion at the start of the war, according to one estimate. (3) Although wages increased somewhat due to the pressures placed on the industrial workplace, the purchasing power of the ruble plummeted as a result of massive inflation and severe shortages. (4) As resources were diverted from the consumer economy to the front, factories assigned portions of their labor forces to growing food to feed their workers. (5) Soviet retail prices, unified with the end of rationing in 1935, split once again into commercial and ration prices. Commercial shops charged higher prices for scarce goods and catered to the wartime elite. (6) Ration prices stayed low and did not change during the war; however, there was frequently nothing to buy at these prices. The prices of goods in the peasant markets, to which workers had long turned when factory stores' shelves were bare, multiplied exponentially as a result. By the second half of 1943, market prices for agricultural products were 13.9 times higher, on average, than they had been in 1940.7 Peasants often refused urban customers' money and bartered for consumer goods, especially toward the beginning of the war. (8) By its end, the countryside held twice the amount of money cities did, fueling bitter anger toward peasant "millionaires." (9) The Soviet ruble was drained of economic value and permeated with social tensions. Yet workers and peasants on the home front gave billions to the state during this period of great privation and uncertainty. (10) Soviet officials offered a simple explanation, chalking up enthusiastic contributions to patriotism and selflessness: at any moment, Soviet patriots were "ready to give their strength, their financial resources, and even their lives for the good of the nation, to defend her freedom, honor, and independence," claimed Arsenii Grigor'evich Zverev, the people's commissar of finance (Narodnyi komissariat finansov, Narkomfin) in 1943.11 A more pragmatic explanation lies precisely in the inflated ruble and the precariousness of daily life: Soviet civilians willingly handed over these sums because money mattered less when it came to procuring necessities than maintaining the social relations that governed access to them. This helps explain why the majority of workers did not resist the pressure to participate in fundraising campaigns, especially those that took place on the shop floor, but it does not explain why individuals often went far beyond the amounts asked of them, sometimes offering the equivalent of two or three months' wages for war bonds rather than the three to four weeks' pay campaign slogans called for. Nor does it explain why peasants, who were not paid in money for their work on collective farms, and who received no rations and were long believed to have a "petty bourgeois" attitude toward money, parted so readily with their rubles. …

Three International Commodity Agreements: The Experience of East Africa

Abstract: Introduction Pressures for international commodity agreements that seek, by means of export restriction schemes, to raise the aggregate export earnings of producing countries are increasing. Such pressures reflect (a) the willingness of consumer countries to make income transfers to poorer countries through this politically acceptable medium, (b) the wish of some producing countries to protect their export crop industries from unwanted competition from new producers, and (c) the desire of international civil servants to promote development from developed country bases. The purpose of the present paper is to strike a discordant note in this otherwise agreeable congruence of interests by focusing attention on the distribution of gains from international commodity agreements among producing countries, with particular attention to the relative shares of the gains that the three East African countries have obtained or are likely to obtain from the agreements that affect three of their principal export crops: coffee, sisal, and tea. The three agreements in question are the International Coffee Agreement (ICA), now in its second 5-year term, the informal sisal agreement (ISA) under the auspices of the Consultative Sub-Committee of the Food and Agriculture Organization of the United Nations (FAO) Study Group on Hard Fibres, which came into effect in January 1968, and the informal tea agreement (ITA) under the FAO Consultative Committee on Tea, which has been in operation just over a year. While the language used to phrase the stated objectives of each of these agreements differs, the implied objectives and means of achieving them are the same, namely, to increase export earnings by getting producing countries to act together quasimonopolistically in restricting supply against an inelastic demand. Thus, the 1968 ICA under Article I has the stated objectives of eliminating fluctuations in coffee prices and increasing the purchasing power of coffee

Kenya: Recent developments in public agricultural research

Abstract: Since the early 1990s, public agricultural research and development (R&D) spending in Kenya has varied considerably from year to year, while agricultural research capacity showed a more stable trend.1 In 2008, Kenya spent 4.5 billion Kenyan shillings or 154 million PPP dollars (both in 2005 constant prices) on agricultural R&D. Unless otherwise stated, all investment data in this note are expressed in purchasing power parity (PPP) prices. PPPs reflect the purchasing power of currencies more effectively than do standard exchange rates because they compare the prices of a broader range of local-as opposed to internationally traded-goods and services. Agricultural R&D spending increased modestly during the 1980s, when several government and higher education agencies involved in agricultural research were established. The variation in spending since the early 1990s, however, was mostly the effect of fluctuations in donor funding and, to a lesser extent, government contributions to KARI.

Central Bank of Brazil’s mission: Ensuring the stability of currency purchasing power and a sound, efficient, and ‘just’ financial system

Abstract: How to cite this paper: von Borowski Dodl, A. (2020). Central Bank of Brazil’s mission: Ensuring the stability of currency purchasing power and a sound, efficient, and ‘just’ financial system. Risk Governance and Control: Financial Markets & Institutions, 10(4), 44-56. https://doi.org/10.22495/rgcv10i4p4 Copyright © 2020 The Author This work is licensed under a Creative Commons Attribution 4.0 International License (CC BY 4.0). https://creativecommons.org/licenses/

A note on money and the consumer in Eastern Europe

Abstract: IT is usually said that in centrally planned economies, consumer goods, unlike means of production moving within the state sector, are real commodities and subject to market rules. This view was held both by Stalin in his Ekonomicheskie problemy sotsializma v SSSR and by Brus in his Og6lne problemy. . . . Brus added that money plays an active role on the labour market and the consumer goods market under the centralized model, while its role is passive in inter-enterprise relations. He allows for rationing, for prices at which supply cannot meet demand, and consequently also for shortages and special shops for privileged groups. At the same time he stresses that these phenomena are not inherent in the centralized model. Whether or not that is the case will not be considered here. What we wish to stress is that there are significant differences in the relative role of bureaucratic distribution and of money flows in the sphere of consumption among East European planned economies. In some CMEA countries the role of money is quite restricted, while in others money has a relatively active role in the allocation of consumer goods.2 In Eastern Europe there are two groups among the items of consumption partly or fully excluded from free distribution according to consumer's preferences and purchasing power. The reasoning concerning one group is just the opposite of that concerning the other. Housing and holiday accommodation (except abroad) are allocated administratively according to non-market preferences, with the justification that they are of prime importance for each member of the community.3 On the other hand, the possession of cars and summer cottages and tourism abroad (in some countries to the West only) are considered luxuries, in the sense that one can live without them, and access to them is limited to a minority of the population and is also allocated administratively (or semiadministratively).