The Consumer Price Index is widely used as a basis for adjusting money incomes in both the private and the public sector. Problems in measuring the cost of owner-occupied housing have contributed to serious deficiences in the accuracy of the CPI's measurement of price level change. A shift to imputed rental value has improved the measure but still ignores a serious conceptual issue. The problem is examined in this article.
Get full access to this article
View all access options for this article.
References
1.
BarzelY. (forthcoming) “The feasibility of the law of demand,” in Financial Economics: Essays in Honor of Paul H. Cootner.New York: Prentice-Hall.
2.
BlinderA. S. (1980) “The consumer price index and the measurement of recent inflation.” Brookings Papers on Econ. Activity2.
3.
GordonR. J. (1981) “The consumer price index: Measuring inflation and causing it.” Public Interest (Spring).
4.
TripletJ. (1981) “Reconciling the CPI and the PCE deflator.” Monthly Labor Rev. (September).
