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.

The Impact of India’s Rural Employment Guarantee on Demand for Agricultural Technology

Abstract: The Mahatma Gandhi National Rural Employment Guarantee Act (NREGA) is approaching eight years of implementation. Since 2006, it has offered up to 100 days per year of guaranteed public works employment to tens of millions of rural Indian households. It is intended to augment the purchasing power of the rural poor during droughts and slack agricultural production periods. Given its scale, it has the potential to generate additional ripples throughout the rural economy. Recent working papers have explored NREGA’s effect of higher agricultural wages. This paper investigates whether this increase in the opportunity cost of agricultural labor incentivizes farm owners to adopt labor-saving agricultural technology. Using a regression discontinuity design and new Indian agricultural census data, this paper finds that NREGA causes a shift of roughly 20 percentage points away from labor-intensive technologies toward labor-saving ones, particularly for small farmers and low-powered technologies. This short-run result can lead to a variety of long-run outcomes in technology use, labor markets, and food security. A focus on education, skill development, and quality infrastructure alongside NREGA would augment the chances that the most positive long-run scenario occurs.

Sources of Purchasing Power Disparities between the G3 Economies

Abstract: Recent theoretical and empirical research in international macroeconomics has rediscovered the problem of purchasing power parity (PPP). Empirically, PPP is a bad approximation of both the short-term and medium-term properties of the data. Economists have had difficulties in explaining the persistent misalignments of real exchange rates, but new empirical research by Clarida and Gali (1995) suggests that much of these real exchange rate movements are due to relative demand shocks. The present paper challenges this view by using an extended version of their structural vector autoregressive (SVAR) model in order to identify a larger number of real shocks (labour supply, productivity and aggregate demand) and nominal shocks (money demand and money supply). It is found that whilst some of their results go through in our extended framework, there is serious doubt with respect to the appropriateness of labelling those shocks which drive real exchange rates as aggregate demand disturbances.

The Key Role of the Leading Emerging Bric Markets in the Future of Global Health Care

Abstract: Acronym BRIC was created 2001 with the notion of marking the most promising and huge emerging markets outside the established postwar high income economies. Brazil, Russia, India and China’s nominal GDP growth rates continue to outpace the ones of Western Europe, North America and Japan before, during and after world macroeconomic crisis. This global phenomena will also heavily affect global demand and provision of health care services as well as other economy branches. The key cause for such change is occurrence of enormously massive middle class of citizens in these countries. Their health insurance coverage is extending together with package of services covered within such plans. Not less important is the overall growth of purchasing power followed by stronger affordability of vast portion of medical goods and services commonly paid out-of-pocket by ordinary citizens. Observing the changing landscape of global health care we should take into account steady slow economy growth rates of most mature, saturated markets. This also reflects to consumer demand for health services which remains strong in rich countries but true expansion of global market size happens actually elsewhere. This is acknowledged by all major market analysis agencies. They overtly recommend to multinational companies dealing with health care to focus on emerging markets and BRICs in particular if they are willing to survive. The key target to harvest long term profits and sustainable presence among pharmaceutical industry and medical equipment manufacturers worldwide shall remain emerging market investment for a long course of years to come. KEY WORDS : BRICs, emerging markets, global, health care, demand, medical services

Financial Crises and the Politics of Macroeconomic Adjustments

Abstract: 1. Introduction 2. The distribution of vulnerabilities: purchasing power, balance sheets, and exchange-rate policy preferences 3. Voters' direct vulnerability to adjustment. European voters in the 2008/9 global economic and financial crisis 4. Indirect vulnerability to adjustment. The determinants of employers' monetary and exchange rate policy preferences 5. Interests, elections, and policy makers' incentives to adjust 6. The politics of adjustment in the Asian financial crisis, 1997/8 7. Adjustment in Eastern Europe during the first phase of the global financial and economic crisis, 2008-10 8. Conclusions.

Calculating Rural-Urban Food Price Differentials from Unit Values in Household Expenditure Surveys: A Comparison with Existing Methods and A New Procedure

Abstract: While purchasing power parity (PPP) between countries has received a great deal of attention, PPP calculations within countries have received less attention. The idea that one unit of currency has the same purchasing power in all regions in large countries is false. This paper addresses this limitation by proposing a methodology for calculating rural-urban PPP in India. The paper introduces a concept of item-specific PPP that exploits the analogy with an item-specific equivalence scale. The methodology relies on demographically-varying preferences to estimate PPP. The results underline the need to incorporate spatial differences in PPP calculations in countries with heterogeneous preferences. Copyright 2012, Oxford University Press.