> It is also important to note that Allin's results do NOT indicate
> that deflation by costs destroys a valid relationship between values
> and prices -- EVEN WHEN the correlation between values and costs
> gets incredibly high. Rather, as I noted above, they suggest only
> that the variation in the independent variable becomes too small to
> produce efficient estimates. The figures he reports DO NOT permit
> us to reject the hypothesis that the true value of the slope
> coefficient is 1...
That is true of the "sample" numbers I posted last, but minor
variations on the procedure do produce strong (false) rejections
of that hypothesis.
Allin Cottrell.