The bias to
price indexes from offshoring is one of several measurement problems arising from the growth of globalization that were examined in conference research.
Recently, Triplett (2001, F331) had strongly contended that "the theory of the cost-of-living index does provide the underlying conceptual rationale for constructing a practical CPI." Furthermore, using the Laspeyres price index (or other fix-basket
price indexes) in constructing a CPI will cause substitution bias in measurement.
Several widely used
price indexes are discussed, and the author presents evidence that favors one particular index.
''From this experience, rice prices are expected to stay high until the fall of next year and may serve as a factor that pushes up the
price indexes until the middle of 2004,'' an official at the Cabinet Office said.
A category inflation index reflects the inflation that occurs in the BLS
price indexes for a selected BLS category (or, if applicable, a BLS category group).
One important use of
price indexes is in the determination of monetary (and possibly fiscal) policy.
However, to the best of my knowledge, this is the first study to discuss output and input
price indexes with particular attention to the market setting in which such indexes are embedded.
import and export
price indexes to adjust for inflation.
These differences are then multiplied by the growth rates in the corresponding item
price indexes to yield percentage-point contributions; that is, the weight effect is computed as
1.472-8 eliminates the requirement to convert published
price indexes into either retail
price indexes or cost
price indexes.
On the negative side, I am concerned that the publication of two different
price indexes as part of the CPI program might generate some confusion.
But, how might we assess the accuracy of widely used
price indexes, such as the Producer Price Index (PPI)?