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Are there any good sources of information for a different aggregate inflation figure than CPI? I have read up on the CPI weightings before and I agree that they

Are there any good sources of information for a different aggregate inflation figure than CPI? I have read up on the CPI weightings before and I agree that they are inaccurate, but trying to find alternative weightings quickly leads into crank territory.

JamesBarney 9y ago
The MIT billion prices project. They basically wrote a program to go out and index a bunch of prices on the internet and see how they change. The results are pretty similar to the CPI. Do you have any specific complaints against the CPI? It's actually a pretty well thought out measure.
- wyldfire 9y ago
  If housing is excluded from CPI, why is it excluded? I'll agree that people make housing decisions infrequently, but it still seems like it should be reflected somehow with some weight into the index.
  - occamrazor 9y ago
    Because buying a house is considered an investment, not a cost. Other housing related costs (e.g. renovations, maintenance, etc.) are included in CPI.
  - maxerickson 9y ago
    Housing isn't excluded from the CPI, it is one of the major components of the CPI. There's all sorts of information about how it is calculated on bls.gov.
  - JamesBarney 9y ago
    Buying a house is excluded, but renting is included. This is because buying a house is an investment, and CPI is meant to track consumption.
    - maxerickson 9y ago
      It factors in the rental value of owner occupied housing, they attempt to exclude the investment value of the property and recognize the shelter value.
- lotsofpulp 9y ago
  Healthcare costs are not accurately represented, and almost all families are just one medical emergency away from losing everything. Also, increasing government taxes, fees, and decreasing quality of government infrastructure and services.
ucaetano 9y ago
AFAIK you can just take the source data and apply your own weightings. For example, based on your own personal spending. Also, calculating inflation can be very tricky. If every new iPhone costs the same, can you say that inflation = 0, or that there is deflation, since the same goods are now available at a lower price?
dv_dt 9y ago
Well, you might look at the fuzzier OECD Better life index. You can weight a set of broader category indicies. http://www.oecdbetterlifeindex.org http://www.oecdbetterlifeindex.org I really don't have a good feel for how robust the index and index data inputs are for that effort though.

JamesBarney 9y ago

The MIT billion prices project. They basically wrote a program to go out and index a bunch of prices on the internet and see how they change. The results are pretty similar to the CPI. Do you have any specific complaints against the CPI? It's actually a pretty well thought out measure.

wyldfire 9y ago
If housing is excluded from CPI, why is it excluded? I'll agree that people make housing decisions infrequently, but it still seems like it should be reflected somehow with some weight into the index.
- occamrazor 9y ago
  Because buying a house is considered an investment, not a cost. Other housing related costs (e.g. renovations, maintenance, etc.) are included in CPI.
- maxerickson 9y ago
  Housing isn't excluded from the CPI, it is one of the major components of the CPI. There's all sorts of information about how it is calculated on bls.gov.
- JamesBarney 9y ago
  Buying a house is excluded, but renting is included. This is because buying a house is an investment, and CPI is meant to track consumption.
  - maxerickson 9y ago
    It factors in the rental value of owner occupied housing, they attempt to exclude the investment value of the property and recognize the shelter value.
lotsofpulp 9y ago
Healthcare costs are not accurately represented, and almost all families are just one medical emergency away from losing everything. Also, increasing government taxes, fees, and decreasing quality of government infrastructure and services.

ucaetano 9y ago

AFAIK you can just take the source data and apply your own weightings. For example, based on your own personal spending. Also, calculating inflation can be very tricky. If every new iPhone costs the same, can you say that inflation = 0, or that there is deflation, since the same goods are now available at a lower price?

dv_dt 9y ago

Well, you might look at the fuzzier OECD Better life index. You can weight a set of broader category indicies. http://www.oecdbetterlifeindex.org http://www.oecdbetterlifeindex.org I really don't have a good feel for how robust the index and index data inputs are for that effort though.