The price index of Passo Fundo (RS, Brazil): Analysis and relevance

Authors

  • Giovani da Silva Oliveira Universidade de Passo Fundo
  • André da Silva Pereira Universidade de Passo Fundo
  • Julcemar Bruno Zilli Universidade de Passo Fundo

DOI:

https://doi.org/10.4013/4280

Abstract

This paper analysed the importance of the Basic Food Price Index of Passo Fundo city (ICBpf), calculated by the Centre for Research and Extension from the Faculty of Economics, Administrative and Accounting (CEPEAC) of the University of Passo Fundo, compared to the Consumer Price Index (IPCiepe) of the Center for Studies and Economic Research (IEPE) from the Federal University of Rio Grande do Sul (UFRGS) and the Consumer Price Index Amplified (IPCA), calculated by the Brazilian Institute for Geography and Statistics (IBGE). The paper also used a dummy variable in order to analyze the variability of the ICBpf along the governments of Fernando Henrique Cardoso and Lula, from January 1995 to April 2009. For this evaluation it is used an econometric model of time series, considering the One Price Law as a theoretical framework. The results showed that the One Price Law is valid only for the IPCiepe, indicating that the ICBpf is valid only for regional comparisons. As for the comparison with the IPCA, the Basic Food Price Index does not capture the variation of this indicator, which can be justified by the magnitude of this index. The Augmented Dickey-Fuller (ADF) test was applied to the ICBpf and IPCiepe series, showing that both series do not have a trend term and could be considered stationary. Otherwise, the results showed a positive and significant relationship between them.This demonstrates the importance of the Basic Food Price Index as an indicator of pricevariations for the region of Passo Fundo.

Key words: price index, basic food, One Price Law.

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Published

2021-06-16

Issue

Vol. 6 No. 2 (2010): Jul-Dec

Section

Articles

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