It was put forward by Austrian economist Emile Pasch at the end of 19. Paixu price index measures the price change by comparing the total purchase expenditure of consumers at two time points. Specifically, Paixu price index takes the current (late) consumer purchase amount as the weight, and compares it with the reference period (early) price in a corresponding weighted way.
The calculation formula of Paixu price index is Paixu price index = (late consumer purchase amount * late price)/(early consumer purchase amount * early price), where the late and early stages can be different time points, and the consumer purchase amount and price can be calculated for a basket of goods or specific goods.
The value of the quotation index indicates the relative change of the price level between two time points. If the allowed price index is greater than 100, it means that the price level is rising; If the allowed price index is less than 100, it means that the price level is declining; If the allowed price index is equal to 100, it means that the price remains unchanged.
In economic research, Xu price index is often used to compare the price level changes at different time points or regions, so as to analyze inflation, measure the price growth rate and evaluate the change of currency purchasing power. It is of great reference value to the government, enterprises and consumers, and is helpful to formulate policies and make decisions on investment and consumption behavior.