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Price Index Concepts and Measurement

Although inflation is much feared for its negative effects on the economy, how to measure it is a matter of considerable debate that has important implications for interest rates, monetary supply, and investment and spending decisions. Underlying many of these issues is the concept of the Cost-of-Living Index (COLI) and its controversial role as the methodological foundation for the Consumer Price Index (CPI).

Price Index Concepts and Measurements brings together leading experts to address the many questions involved in conceptualizing and measuring inflation. They evaluate the accuracy of COLI, a Cost-of-Goods Index, and a variety of other methodological frameworks as the bases for consumer price construction.

Table of Contents

Prefatory Note

Introduction: What are the Issues?
W. Erin Diewert, John Greenlees, and Charles Hulten

1. A Review of the Reviews: Ninety Years of Professional Thinkning About the Consumer Price Index
Marshall Reinsdorf and Jack E. Triplett

2. Apparel Prices 1914-1993 and the Hulten/Bruegel Paradox
Robert J. Gordon

3. Reassesing the U. S. Quality Adjustment to Computer Prices: The Role of Durability and Changing Software
Robert C. Feenstra and Christopher R. Knittel

4. Hedonic Imputation versus Time Dummy Hedonic Indexes
W. Erwin Diewert, Saeed Heravi, and Mick Silver
Comment: Jan de Haan
Reply by W. Erwin Diewert, Saeed Heravi, and Mick Silver 

5. CPI Bias from Supercenters: Does the BLS Know That Wal-Mart Exists?
Jerry Hausman and Ephraim Leibtag
Comment: Marshall Reinsdorf
Comment: Mick Silver

6. Incorporating Financial Services in a Consumer Price Index
Dennis Fixler
Comment: Susanto Basu

7. A General Equilibrium Asset-Pricing Approach to the Measurement of Nominal and Real Bank Output
J. Christina Wang, Susanto Basu, and John G. Fernald
Comment: Paul Schreyer

8. Can A Disease-Based Price Index Improve the Estimation of the Medical Consumer Price Index?
Xue Song, William D. Marder, Robert Houchens, Jonathan E. Conklin, and Ralph Bradley

9. Price and Real Output Measures for the Education Function of Government: Exploratory Estimates for Primary and Secondary Education
Barbara M. Fraumeni, Marshall Reinsdorf, Brooks B. Robinson, and Matthew P. Williams

10. Measuring the Output and Prices of the Lottery Sector: An Application of Implicit Expected Utility Theory
Kam Yu
Comment: Alan G. White

11. Consumption of Own Production and Cost-of-Living Indexes
T. Peter Hill

12. Durables and Owner-Occupied Housing in a Consumer Price Index
W. Erwin Diewert
Comment: Alan Heston

Author Index
Subject Index

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