EconPapers    
Economics at your fingertips  
 

The laspeyres bias in the Spanish consumer price index

Javier Ruiz-Castillo (), Eduardo Ley and Mario Izquierdo ()

No 2000-05, Working Papers from FEDEA

Abstract: The CPI compares the cost of acquiring a reference quantity vector at current and base prices. Such reference vector is the vector of mean quantities actually bought by a reference population, whose consumption patterns are investigated during a period t prior to the index base period 0. In this paper we show that unless one takes into account the price index of the Laspeyres types. Among several negative consequences, the most important is that this omission produces a bias in the measurement of inflation which we call the "Laspeyres bias". Using Spanish data, we estimate that, e.g. from 1992 to 1998, the size of the Laspeyres bias is -0.061 per cent per year, or about 6 per cent (in absolute terms) of the positive bias estimated by the Boskin commission for the U.s., which is equal to 1.1 per cent per year. The Laspeyres bias in shorter time periods reached -0.122, and -0.108 per cent per year in 1992, and 1997, respectively.

References: Add references at CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
https://documentos.fedea.net/pubs/dt/2000/dt-2000-05.pdf (application/pdf)

Related works:
Journal Article: The Laspeyres bias in the Spanish consumer price index (2002) Downloads
Working Paper: The Laspeyres bias in the Spanish consumer price index Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fda:fdaddt:2000-05

Access Statistics for this paper

More papers in Working Papers from FEDEA
Bibliographic data for series maintained by Carmen Arias ().

 
Page updated 2022-10-04
Handle: RePEc:fda:fdaddt:2000-05