4 ms·
So you measure inflation price per gram model fixed. Current inflation models are also flawed in other ways as it changes goods exchange. Also if a measured ma
by acd 7y ago
So you measure inflation price per gram model fixed.
Current inflation models are also flawed in other ways as it changes goods exchange. Also if a measured market good is better price is adjusted.
Example larger tv size.
- nabla9 7y agoThe shrinkflation problem in bulk retail CPI calculation comes from the way the the data is collected. They typically use GTIN numbers and those don't change when the quantity changes. You need to do additional work to correct for that. Quality adjustment in CPI calculation is routinely done for many products using hedonic modeling. It's important in all rapidly advancing product categories like like TV's as you mention. For a product like a smartphone price difference between the replacement item and its predecessor is almost never pure price change. For example screen resolution change in smartphones induces quality adjustment to the price change.