Measuring Inflation: Criticism and Solution

Ferenc Laczó

MPRA Paper from University Library of Munich, Germany

Abstract: In this study the concept of commodities is formulated according to the utility theory; following the principle of price elasticity of demand, differences of uncompensated and compensated price changes will be clearly interpreted; as the uncompensated and compensated price changes have different averaging properties, so two different CPI formulas need to be defined; arbitrary price changes are broken down into uncompensated and compensated price change to obtain a complete, dual CPI formula.

Keywords: Economic Value of a Commodity; Uncompensated vs. Compensated Price Change; Common Units in Measurements; Dual CPI Formula; Supply-Driven and Demand-Driven Economy (search for similar items in EconPapers)
JEL-codes: E31 (search for similar items in EconPapers)
Date: 2021-06-30
New Economics Papers: this item is included in nep-isf, nep-mac, nep-mon, nep-ore and nep-upt
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