Comparing the superlative Törnqvist and Fisher ideal indexes

This paper identifies the sources of differences between the Törnqvist index and Fisher ideal index and shows mathematically why these indexes will numerically approximate each other. Since both are “superlative” indexes, they have similar desirable theoretical properties. However, a component’s contribution to the growth of the Törnqvist index requires less data and is easier to calculate than its contribution to the growth of the Fisher ideal index and, thus, the former index appears handier in practice.