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Afriat’s Theorem and the Index Number Problem


  • Corresponding author: S. N. Afriat, University of Siena. Email: s.afriat

  • This paper was originally presented at an Invited Session at the Royal Economic Society Annual Conference on the ‘Foundations of Revealed Preference’. The session organisers are responsible for author-centric title.


After a statement of what is meant by a price index there follows argument for the New Formula which is the basis for resolving the Index Number Problem (Afriat, 1981), joined with rejection of the approach with a formula for any pair of references puzzled about for so long — as by Irving Fisher with his collection of one or two hundred (Fisher, 1922, 1927).