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A Review of Reviews: Ninety Years of Professional Thinking About the Consumer Price Index

A Review of Reviews: Ninety Years of Professional Thinking About the Consumer Price Index

Chapter:
(p.17) 1 A Review of Reviews: Ninety Years of Professional Thinking About the Consumer Price Index
Source:
Price Index Concepts and Measurement
Author(s):
Marshall Reinsdorf, Jack E. Triplett
Publisher:
University of Chicago Press
DOI:10.7208/chicago/9780226148571.003.0002

This chapter provides a detailed history of the evolution of the Consumer Price Index (CPI), and a comprehensive review of the various commissions formed to study it. It reveals the long-standing nature of many CPI issues that are still controversial today. Apart from providing various CPI reviews, the authors present their views on the alternative methodological foundations for a consumer price index and, in particular, debate the merits of the economic or Cost-of-Living Index (COLI) approach versus the Cost-of-Goods Index (COGI). It is found that the COLI approach to CPI index construction is superior to either the COGI or test approaches, but it is also noted that the test approach can be useful on occasion as a supplement to the economic approach to index construction.

Keywords:   Consumer Price Index, CPI, Cost of Living, COLI, price index, index construction, Cost of Goods, COGI

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