Abstract: In 1996, the U.S. Department of Commerce began using a new method
to construct all aggregate ``real'' series in the National Income and Product Accounts (NIPA).
This method employs the so-called ``ideal chain index'' pioneered by Irving Fisher.
The new methodology has some extremely important implications that are unfamiliar
to many practicing empirical economists; as a result, mistaken calculations with
NIPA data have become very common. This paper explains the motivation for the switch to
chain aggregation and then illustrates the usage of chain-aggregated data with three topical
examples, each relating to a different aspect of how information technologies are
changing the economy.
Keywords: NIPA Data, chain aggregation, information technologies
Full paper (144 KB PDF)
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Last update: August 11, 2000
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