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.

Biases in cross-spave comparisons through cross-time price indexes : the case of Russia

Abstract: Lacking data on price levels across locations (countries, national regions, etc.) for crossspace comparisons, researchers resort to local consumer price indexes (CPIs) over time to evaluate these levels.This approach unfortunately fails to specify, even generally, the exactness of such proxies.Worse, the method is silent on whether the results are consistent, at least qualitatively, with those obtained using actual price levels.This paper aims to find an answer empirically, using data across Russian regions.Through comparison of CPIproxied price levels with direct evaluations of regional price levels (i.e.Surinov spatial price indexes and the costs of a purchasing power basket), biases that distort the qualitative pattern of inter-regional differences are identified.Cross-region distributions for real income (calculated with CPI-proxied and directly evaluated price levels) for several points in time are estimated and compared.The CPI-induced biases are found to generally overstate inter-regional disparities. JEL Classification: C43, E31, P22, R19 Keywords: consumer price index, spatial price index, real income, nonhomothetic preferences, Russia, Russian regions

Changing Paradigms in Medical Payment

Abstract: The enormous level and rate of increase in health care expenditures in the United States during the past several years has been well documented. A combination of increased health insurance coverage and advances in medical technology, coupled with perverse economic incentives resulting in supplier-induced demand and cost-unconscious demand from patients, has created this explosion in health care spending. This explosive increase has given rise to a variety of private and public sector initiatives to reform the system. With a greater concentration of purchasing power among managed care payors and increased competition among providers, a trend toward dramatically reduced payment for providers continues. Under capitation, the most rapidly growing form of managed care, providers have contracts from insurance companies that call for them to provide care for a fixed per patient annual payment, regardless of what this provision actually costs. This form of per capita payment typically offers drastically reduced payment to providers, forcing them to adopt a cost-reduction strategy. Providers must contain costs while enhancing quality or else perish in this new cost-conscious environment. This new payment paradigm means that price, which is often dictated by the payors, including government, determines the providers' cost rather than cost determining price as it was under the traditional indemnity insurance schemes. It is this new imperative to contain costs while maintaining or else improving the quality of health outcomes that is behind many of the recent mergers and other collaborative activities that we are witnessing nationwide among hospitals and other health care organizations. (Arch Intern Med. 1996;156:357-360)

Towards a Quasi-market in Reintegration Services: First Assessment of the Dutch Experience

Abstract: The Netherlands has recently introduced market forces into the labour market reintegration services sector. In this paper, we examine the extent to which the emerging market-oriented Dutch reintegration services sector meets the conditions, established by Le Grand and Bartlett (1993), for the efficient functioning of quasimarkets. Le Grand and Bartlett define a 'quasi-market' as a market where independent agents compete with one another for custom from purchasers, but where purchasing power comes not directly from consumers but from the state. This study makes a first assessment of the Dutch experience with a market-oriented reintegration services sector for the period 2000-2002. The paper concludes that the key strength of the new Dutch reintegration services market lies in the way the market has been structured and the mechanisms by which providers and purchasers (on behalf of the clients) have been motivated to act in the best interests of clients. Information flow and transaction cost outcomes, two further key dimensions of an efficient quasi-market, are moving in a positive direction. There are, however, indications of risk-averse behaviour by providers. The question is how this may be tackled in further refinements to the tendering process.

Assistance to the transition economies : were there alternatives?

Abstract: Twelve years after the fall of the Berlin Wall, domestic and international analysts of the transition economies by and large agree that the transition from central planning to a market economy has been exceedingly difficult. There has also been a major debate about the extent to which the transition to date has succeeded or failed. This paper provides an assessment of the policies that were followed and discuss the extent to which there were known alternatives that can have resulted in superior outcomes in terms of: (a) gross domestic product (GDP) growth and other principal performance indicators, (b) building honest and competent institutions, and (c) creating a more transparent and less corrupt system of corporate and national governance. Section two provides a brief overview of performance since 1989. Section three presents the recommendations that were made and policies that were followed. The paper concludes in section four by assessing the extent to which alternative paths can have been followed and what the likely outcomes will have been.