Currency values, prices, consumption and incomes are at the heart of the economic performance of all countries. In order to make a meaningful comparison between one economy and another, economists routinely make use of purchasing power parity (PPP) exchange rates, but while PPP rates are widely used and well understood, they take a lot of effort to produce and suffer from publication delays. Currencies, Commodities and Consumption analyses the strengths and weaknesses of two alternatives to PPP. Firstly, the so-called Big Mac Index, which uses hamburger prices as a standard of measurement, and second, a less well known technique which infers incomes across countries based on the proportion of consumption devoted to food. Kenneth W. Clements uses international macroeconomics, microeconomic theory and econometrics to provide researchers and policy makers with insights into alternatives to PPP rates and make sense of the ongoing instability of exchange rates and commodity prices.

Currency values, prices, consumption and incomes are at the heart of the economic performance of all countries. In order to make a meaningful comparison between one economy and another, economists routinely make use of purchasing power parity (PPP) exchange rates, but while PPP rates are widely used and well understood, they take a lot of effort to produce and suffer from publication delays. Currencies, Commodities and Consumption analyses the strengths and weaknesses of two alternatives to PPP. Firstly, the so-called Big Mac Index, which uses hamburger prices as a standard of measurement, and second, a less well known technique which infers incomes across countries based on the proportion of consumption devoted to food. Kenneth W. Clements uses international macroeconomics, microeconomic theory and econometrics to provide researchers and policy makers with insights into alternatives to PPP rates and make sense of the ongoing instability of exchange rates and commodity prices.

World Commodities and World Currency presents Graham's thoughts on the importance and growth of world commodity stabilization; its impact on world currency; the declining power of cartels; and his unique theory on stock-piling, which encouraged expansion and stability in a postwar economy.

Discusses economic issues associated with exchange rates, commodity prices, the economic size of countries and alternatives to PPP exchange rates.

Fluctuations of commodity prices, most notably of oil, capture considerable attention and have been tied to important economic effects. This book advances our understanding of the consequences of these fluctuations, providing both general analysis and a particular focus on the countries of the Pacific Rim.

Movements in exchange rates can change the prices of goods faced by producers and consumers and thereby affect incentives to produce, consume, and trade goods. Exchange rate changes, however, might not be completely transmitted (passed through) to domestic prices. Price and exchange rate transmission for ag. products is low in most developing economies, partly because of trade policies but also because of inadequate infrastructure and other market deficiencies. During the last 20 years, developed and developing countries have moved away from support policies that impede price and exchange rate transmission toward trade policies that allow transmission, such as tariffs. However, market deficiencies remain as a cause of incomplete transmission. Illus.

Excerpt from Rational Money: A National Currency Intelligently Controlled in the Interests of the Whole People and Carefully Regulated in Reference to the True Commodity Bases, the Real Constant of Exchange, by Means of the Multiple Standard Fact. History sanctions an independent paper of regulated volume. Reason. Science proves such money to be the best. Authority. Distinguished leaders of thought, economists, statesmen, and financiers approve the principles on which the plan is based. The Power of Paper, with the Multiple Standard. The essential attribute of money is general receivability. Money should not be a promise to pay, but to receive, and to see that; others receive. Next to receivability the most vital fact of monetary science is the movement or non-movement of the money volume. Through this prices may be controlled, a rise or fall produced, or a rise or fall from other causes prevented, or checked and cancelled if it has occurred. Power to control the money volume is power to do justice or injustice between debtor and creditor, laborer and employer, buyer and seller, landlord and tenant, interest receiver and entrepreneur; power to increase the weight and value of every debt public or private, power to produce panic or prosperity, power to regulate industry and determine the distribution of wealth. Such power is an attribute to sovereignty and ought to belong to none but the sovereign people. The money volume should no longer be left to chance or private manipulation, but subjected to intelligent control in the interest of the public. Steadiness of value is the morality of the dollar. An appreciating dollar robs debtors and depresses industry. A depreciating dollar robs creditors and may lead to feverish speculation. The creditor should receive the same purchasing power that he lent, the same command over commodities, services, all the means of life and happiness, To accomplish this the dollar must not be based on a gold standard, for the purchasing power of gold is not constant, but exceedingly variable. The same is true of the bi-metallic standard in a slightly less degree. The average purchasing power of gold and silver vibrates a little less than gold alone. Two commodities may be better than one, but 100 or 200 or 500 commodities make a steadier base than two. A list of all commodities would be constant in the sum of its exchange values. If the value of one commodity fell the others would gain what it lost, their purchasing power over it would be increased in the same ratio that its purchasing power over them is diminished, and vice versa if one or more commodities rise in exchangeable value the others fall in like ratio. The true standard is a list of all commodities each one being entered according to its importance in consumption and expenditure. The nearest practicable approach to this is a long list of commodities weighted according to importance, each commodity being entered in such amount as to have the same value relatively to the total value of the list, that the consumption of that commodity has to the total consumption of the community. The nearest to all commodities is a large number of commodities so selected as to fairly represent the various parts and classes of the whole. It is this composite or Multiple Standard which justice and progress require us to adopt. A national paper money regulated in volume so as to be in harmony with this standard will constitute a mighty power for justice and prosperity. About the Publisher Forgotten Books publishes hundreds of thousands of rare and classic books. Find more at www.forgottenbooks.com