GAO Glossary of Terms and Definitions (September 2005)

Implicit Price Deflator

(Economics Term)

Weighted averages of the most detailed price indexes used in estimating real output. Before 1995, implicit price deflators were calculated as the ratio of current- to constant-dollar output multiplied by 100. Since 1995, implicit price deflators have been calculated as the ratio of current- to chained-dollar output multiplied by 100. For all but the most recent estimates, the implicit price deflators are identical to the chain-type price indexes because the weights used to aggregate the detailed prices for the two measures are the same. Implicit price deflators are used in the National Income and Product Accounts (NIPA). (See also Chain Price Indexes; Chained Dollars.)

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