Journal Article Professor Hicks' Index Number Theorem Get access R. L. Marris R. L. Marris Cambridge Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 25, Issue 1, October 1957, Pages 25–40, https://doi.org/10.2307/2296119 Published: 01 October 1957

Abstract When the present Committee On Costs And Standards was formed several years ago in the U.S. it was charged it with the responsibility for developing a statement of cost concepts without specifying either the objectives or content of that statement. For many reasons development of a statement paralleling those issued by the Association on accounting principles underlying corporate financial statements was abandoned in favor of a more general statement relevant to management purposes. This decision reflected an awareness of the growing importance in accounting of the management viewpoint and the lack of any statement of sufficient general validity to perform for management costing the same functions presents statements on accounting principles do for income determination. Rapid developments in recent years in other disciplines have placed a premium upon proper cost constructions. Statistical decision theory, linear programming, mathematical prograimning, waiting line theory, input-out-put analysis, and the like all depend upon accounting for cost data relevant to purposes other than income determination.

Abstract Leaders in the accounting profession have become increasingly concerned about the supply of broadly trained persons for top positions in accounting firms. Notwithstanding, many firms have neglected to devise programs for systematic development of staff to assume the growing leadership responsibilities inherent in modem public accounting practice. Too often firms are made up of groups of specialists. This tends to narrow the individual staff member's experience so that by the time he has progressed in the firm to where he is a candidate for top management responsibilities, it may be too late to give him the broad experience requisite for the executive position. This paper has presented a broad format which might serve as a guide to a programmed appraisal and guidance by accounting firms of staff member development. A periodic and orderly appraisal of staff members eliminates the hit or miss subjective way in which staff progression is plotted in many firms. It has been well stated that in a professional service, "jobs are people." A planned program of staff appraisal and guidance will assure that able men be given opportunities to gain the sequential knowledge so necessary for progression to top decision-making positions. It will also assure a firm that its operational, training, and promotion policies will always be under adequate control.

Reviews the book "Statistical Sampling for Auditors and Accountants," by Lawrence L. Vance and John Neter.

Abstract When costs are incurred for purposes of generating revenue, useful information can be obtained by a measurement of such costs and a consequent matching with revenue. As investment purposes shift to social benefit, either in part or in whole, a crucial question as to the relevancy of costs and revenue arises. A portion of total costs incurred may be considered as related to the ensuing revenue, but the problem of prorating such costs between the two ends, revenue and social benefit, is insurmountable. The problem of allocating joint costs to products seems relatively simple by comparison. No such allocation need be made however, for an absence of revenue indicates a greater deficit to be covered by groups other than patients. Inasmuch as the residual of such matching would be affected by many elements other than revenue, it is believed that the term "net income" is grossly misleading, particularly so if identified as that of a fund rather than the economic unit. It is further believed that a measurement of total costs matched with asset in- flows can contribute to an important question-the cost-shares to be bone by various groups. The usefulness of the fund structure is such that no attempt should be made to impose depreciation upon the Statement of Revenue and Expenditures. It is suggested instead that in addition to other statements, a new statement be prepared designed to show costs of operations and how the burden of such was distributed. This suggestion is illustrated in the following statement.

Reviews the book "The Stock Market," by George L. Leffler.

HOW important is it to avoid a moderate, creeping inflation? When nearly full employment has been reached, should continued pressure for higher employment be applied even at the cost of inflationary results? If inflationary pressures exist, what repressive measures are justified to offset these pressures? In spite of widespread agreement on the general objectives of monetary-fiscal policy, we have little organized information on the effects of inflation on different groups in periods of substantially full employment. We need to know more in detail about these effects in order to make reasoned judgments as to how hard we should fight against such inflation and what particular types of repressive policies are best to use. Most major American groups appear to be against inflation. President Eisenhower and ex-President Truman, the C.I.O. and the A.F. of L., the National Association of Manufacturers and the Committee for Economic Development, all have stressed the importance of preserving the purchasing power of the American dollar. Avoidance of mass unemployment and depression seems definitely the first objective of governmental monetary-fiscal policy, but avoidance of inflation appears to come not far behind. Yet the reasons why these diverse groups oppose inflation, if we are to judge by the statements of their leaders, are many, and often muddled. Nor is there any clear consensus among economists as to who gains and who loses from inflation. The most common statements we have found by leading economists 1 fall into two groups: lead-lag propositions, notably that wages lag behind profits in inflation, while interest and rents lag still further, reflecting varying degrees of upward price flexibility; and debtor-creditor propositions, notably that debtors gain at the expense of creditors in inflation. The present investigation suggests that these lead-lag propositions about inflation are questionable, if not wrong, as applied to the type of inflation in the United States since I939. And while there has indeed been a mass debtorcreditor inflation-induced transfer of purchasing power in the United States since I939, the pattern of the transfer has been complex. Business firms, often thought to be major debtors in the American economy, have not been major gainers from inflation on debtor account. This exploratory paper is concerned primarily with the redistributional effects of the recent moderate American inflation on current incomes and on wealth. It does not consider directly the effect inflation may have on aggregate output and employment, although the findings may be helpful in analyzing this question. The following sections include: (I) a brief statement of our approach in investigating the problem; (II) some evidence concerning the effect of inflation on the distribution of income by economic function; (III) an analysis of the transfer of wealth by inflation; and (IV and V) brief consideration of inflation's effects on different classes of households and on nonfinancial corporations, respectively. For those already familiar with the behavior of shares of the national income over the years considered, the later sections of the paper will be of primary interest.

This book is a collection of some of Professor Shackle's papers written between 1939 and 1953 is largely concerned with the problems of 'expectation' and 'uncertainty' and with reducing these universal factors to some sort of plausible rules. Also included are essays on interest rates, on investment and employment, and on the philosophy of economics. This book, by one of the finest economic writers of his time, will appeal to anyone with an interest in the history of economics.