The use of chain indices for deflating the national accounts

Abstract

The problem of deflating national accounts and input–output tables can be approached from the theoretical as well as from the practical side. Although the theoretical argument favors the use of chained Vartia-I indices, the current practice of compiling national accounts is restricted to Using chained Paasche and Laspeyres indices. Various possible objections to the use of chained indices can be raised and rejected.