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There have been methodology changes between 1970 and today.
by 88913527 4y ago
There have been methodology changes between 1970 and today.
- NovemberWhiskey 4y agoThat doesn't make any difference; any methodological differences are just swamped by the erroneous double application of the price deflator in the comparison.
- gruez 4y agoOkay but two wrongs don't make a right. If there were actually methodology changes that caused CPI to be not representative of purchasing power then accounting for CPI twice doesn't really fix anything, it just adds more noise into the result. To do it properly you need to explain what the methodology changes were, estimate their impact on the "real" CPI, and use your revised CPI to account for inflation. The author hasn't done that, so it's far more likely she has no idea what she's doing.
- dan-robertson 4y agoI don’t know if you’re thinking of it but there’s this site called shadowstats which claims to calculate CPI/inflation with the old method and shows totally wild inflation numbers but the way it actually works is that the guy who runs the site takes regular CPI and adds in adjustments to his liking to get inflation numbers that he thinks look right. My understanding is that you get pretty similar numbers with either methodology. See more here for example: https://fullstackeconomics.com/no-the-real-inflation-rate-isnt-14-percent/ https://fullstackeconomics.com/no-the-real-inflation-rate-is...