Producer Price Index (PPI)
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<p><strong>Producer Price Index </strong> (PPI) measures the average change in the price of goods and services either as they leave the place of production, called output PPI or as they enter the production process, called input PPI. </p> | <p><strong>Producer Price Index </strong> (PPI) measures the average change in the price of goods and services either as they leave the place of production, called output PPI or as they enter the production process, called input PPI. </p> | ||
<p>PPI estimates the change in average prices that a producer receives.</p> | <p>PPI estimates the change in average prices that a producer receives.</p> | ||
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<p><strong>PPI Vs Wholesale Price Index (WPI)</strong></p> | <p><strong>PPI Vs Wholesale Price Index (WPI)</strong></p> | ||
− | <p>PPI is different from WPI | + | <p>PPI is different from [http://arthapedia.in/index.php?title=WPI_Food_Index WPI] on following grounds:</p> |
− | + | ||
− | on following grounds:</p> | + | |
<UL> | <UL> | ||
<LI>WPI captures the price changes at the point of bulk transactions and may include some taxes levied and distribution costs up to the stage of wholesale transactions. PPI measures the average change in prices received by the producer and excludes indirect taxes. </li> | <LI>WPI captures the price changes at the point of bulk transactions and may include some taxes levied and distribution costs up to the stage of wholesale transactions. PPI measures the average change in prices received by the producer and excludes indirect taxes. </li> | ||
− | <LI>Weight of an item in WPI is based on net traded value whereas in PPI weights are derived from Supply Use Table<sup class="reference">[[#ref1|[1]]].</li> | + | <LI>Weight of an item in WPI is based on net traded value whereas in PPI weights are derived from Supply Use Table<sup class="reference">[[#ref1|[1]]]</sup>.</li> |
<LI> | <LI> | ||
PPI removes the multiple counting bias inherent in WPI.</li> | PPI removes the multiple counting bias inherent in WPI.</li> | ||
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<p><strong>PPI Vs Consumer Price Index (CPI)</strong></p> | <p><strong>PPI Vs Consumer Price Index (CPI)</strong></p> | ||
<p>PPI is different from CPI on following grounds:</p> | <p>PPI is different from CPI on following grounds:</p> | ||
− | <p>PPI estimates the change in average prices that a producer receives while [http://www.arthapedia.in/index.php?title=Consumer_Price_Index CPI ] measures the change in average prices that a consumer pays. The prices received by the producers differ from the prices paid by the consumers on account of various factor such as taxes, trade and transport margin, distribution cost etc..</p> | + | <p>PPI estimates the change in average prices that a producer receives while [http://www.arthapedia.in/index.php?title=Consumer_Price_Index CPI] measures the change in average prices that a consumer pays. The prices received by the producers differ from the prices paid by the consumers on account of various factor such as taxes, trade and transport margin, distribution cost etc..</p> |
<p>Weights of items in CPI are derived from Consumer Expenditure Surveys whereas for PPI it is calculated on the basis of Supply Use tables. </p> | <p>Weights of items in CPI are derived from Consumer Expenditure Surveys whereas for PPI it is calculated on the basis of Supply Use tables. </p> | ||
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==Also See == | ==Also See == | ||
<UL> | <UL> | ||
− | <LI>WPI Food Index</li> | + | <LI>[http://arthapedia.in/index.php?title=WPI_Food_Index WPI Food Index]</li> |
− | <LI>Wholesale Price Index (WPI) </li> | + | <LI>[http://www.arthapedia.in/index.php?title=Wholesale_Price_Index_(WPI) Wholesale Price Index (WPI)] </li> |
<LI> | <LI> | ||
[http://www.arthapedia.in/index.php?title=Consumer_Price_Index Consumer Price Index ] (CPI) </li> | [http://www.arthapedia.in/index.php?title=Consumer_Price_Index Consumer Price Index ] (CPI) </li> | ||
<LI>[http://www.arthapedia.in/index.php?title=Consumer_Food_Price_Index_(CFPI) Consumer Food Price Index ]</li> | <LI>[http://www.arthapedia.in/index.php?title=Consumer_Food_Price_Index_(CFPI) Consumer Food Price Index ]</li> | ||
</UL> | </UL> | ||
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==Contributed by== | ==Contributed by== | ||
− | [http://ies.gov.in/myaccount-profile-view.php?memid=300 Mr. Anupam Mitra (IES 2003) ] | + | [http://ies.gov.in/myaccount-profile-view.php?memid=300 Mr. Anupam Mitra (IES 2003)]<br> |
Email: [mailto:anupam.mitra@gov.in anupam.mitra@gov.in ] | Email: [mailto:anupam.mitra@gov.in anupam.mitra@gov.in ] | ||
[[Category:concepts|ProducerPriceIndex(PPI)]] | [[Category:concepts|ProducerPriceIndex(PPI)]] |
Latest revision as of 07:00, 15 May 2017
Producer Price Index (PPI) measures the average change in the price of goods and services either as they leave the place of production, called output PPI or as they enter the production process, called input PPI.
PPI estimates the change in average prices that a producer receives.
PPI Vs Wholesale Price Index (WPI)
PPI is different from WPI on following grounds:
- WPI captures the price changes at the point of bulk transactions and may include some taxes levied and distribution costs up to the stage of wholesale transactions. PPI measures the average change in prices received by the producer and excludes indirect taxes.
- Weight of an item in WPI is based on net traded value whereas in PPI weights are derived from Supply Use Table[1].
- PPI removes the multiple counting bias inherent in WPI.
- WPI does not cover services and whereas PPI includes services.
PPI Vs Consumer Price Index (CPI)
PPI is different from CPI on following grounds:
PPI estimates the change in average prices that a producer receives while CPI measures the change in average prices that a consumer pays. The prices received by the producers differ from the prices paid by the consumers on account of various factor such as taxes, trade and transport margin, distribution cost etc..
Weights of items in CPI are derived from Consumer Expenditure Surveys whereas for PPI it is calculated on the basis of Supply Use tables.
Also See