Aggregate production and price level: Volume calculations in comparison

On the basis of a decision by the European Commission of 30 November 1998, in spring 2005 the Federal Statistical Office converted the calculation of real GDP for Germany from a fixed price basis to a previous year price basis. Since February of this year, the working group "national accounts calculation of the German federal states" has been applying this concept. The conversion to the previous year price basis with annually changeable weighting has been accompanied by considerable changes. This article shows the consequences of this change of method for the measurement of economic growth and aggregate price development.