Business Intelligence

Implementing US GDP In Chained Prices For Cross-Country GDP Growth And Sectoral Comparisons: Application To Selected ASEAN Countries

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Executive Summary

GDP in constant prices of ASEAN countries suffers from substitution bias by ignoring relative price changes and makes GDP growth and shares dependent on the base year. These analytical deficiencies led the US since the mid-1990s to convert GDP from constant to chained prices. Thus, cross-country comparisons in constant prices are analytically shaky even with the same base year. Therefore, this paper implements US GDP in chained prices in Indonesia, Malaysia, Philippines, and Thailand to alleviate substitution bias and prevent base-year dependence of GDP growth and shares for valid cross-country comparisons.

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