Rationalizing the Penn World Table: True Multilateral Indices for International Comparisons of Real Income
为宾大世界表使用的Geary方法提供了理论基础,称为GAIA系统,并指出该方法在非齐次Leontief偏好下是精确的,但可能低估国际不平等程度。
Real incomes are routinely compared internationally using methods that “correct” for deviations from purchasing power parity. The most widely used of these is the Geary method which, though theoretically suspect, underlies the Penn World Table. This paper provides a theoretical foundation for the Geary method which I call the GAIA (“Geary-Allen International Accounts”) system. I show that the Geary method is exact when preferences are non-homothetic Leontief and, more generally, gives a (possibly poor) approximation to the GAIA benchmark. An empirical application suggests that both it and other widely used methods underestimate the degree of international inequality.