Quality Adjusted Prices for the American Automobile Industry: 1906-1940

We push the span of hedonic price calculations for automobiles backwards towards the industry's birth. Most of the real change that occurred between 1906 and 1982 occurred between 1906 and 1940. During these years, hedonic prices fell at an average annual rate of 5%. The pace was brisker still...

Full description

Saved in:
Bibliographic Details
Published inIDEAS Working Paper Series from RePEc
Main Authors Raff, DMG, Trajtenberg, M
Format Paper
LanguageEnglish
Published St. Louis Federal Reserve Bank of St. Louis 01.01.1995
Online AccessGet full text

Cover

More Information
Summary:We push the span of hedonic price calculations for automobiles backwards towards the industry's birth. Most of the real change that occurred between 1906 and 1982 occurred between 1906 and 1940. During these years, hedonic prices fell at an average annual rate of 5%. The pace was brisker still during the first 8-12 years. Our measured declines can be decomposed into price and quality components. Our calculations suggest that 60% of the overall decline 1906-1940 was due to process innovation and only 40% to product innovation or quality change per se. Regressors representing mechanical systems matter in these calculations.(This abstract was borrowed from another version of this item.)