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BLS calculation methods

  • Sun, Aug 25, 2013 - 01:32pm

    #6
    Peter Squitieri

    Peter Squitieri

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    Joined: Aug 25 2013

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    BLS calculation methods

Penski:

 

Read this very well-thought out article from way back in 2008

http://www.bls.gov/opub/mlr/2008/08/art1full.pdf

In it they (the BLS)  explains why they use hedonic adjustment,  what it is,  and why every academic economist approves of it.  The case is pretty compelling.

More important, they point out (pg 9)  that using the hedonic methods INCREASE the CPI-U, not decrease it.  And the impact is a miniscule 0.005 % per year.

so even if you don't like using it,  it's making only a very tiny difference in the reported CPI-U and CPI-W