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Krugman famously claimed that the CPI becomes more useful when you remove food, energy, cars and fuel from it. There seems to be some foundational philosophical
by OgsyedIE 2mo ago
Krugman famously claimed that the CPI becomes more useful when you remove food, energy, cars and fuel from it. There seems to be some foundational philosophical issues with deciding what the field of economics is supposed to accomplish.
- AnimalMuppet 2mo agoThat's not the cost of living, then. It's the "cost of starving and/or freezing to death while not going anywhere". Like that's a number we care about. But I suspect that Krugman's point (even if he expressed it badly) is that food, energy, and fuel are more noisy - more seasonal, but also have more noise in other ways. Well, if you want an early warning of which direction the economy is going, you don't want the noise, because if you mistake it for signal, you're going to be misled. So an economist may well find such a number more useful.