Quality Adjustment in the CPI: Men’s Underwear : U.S. Bureau of Labor Statistics

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Bureau of Labor Statistics > Consumer Price Index > Methods > Quality Adjustment

Quality Adjustment in the CPI: Men’s Underwear

Item Definition

The item men’s underwear is part of the index for men’s apparel. It is nested inside the Entry Level Item (ELI) and item stratum for men’s underwear, hosiery, nightwear, and swimwear. Here, we examine the hedonic regression model used in the quality adjustment of price data for men’s underwear.

Sample

The sample used for this hedonic model included 823 observations from an extract of CPI data from January and February 2023 as well as web scraped data from a large national retailer. The CPI data was collected using a larger than usual amount of web-based information due to restrictions on data collection during the COVID-19 pandemic. There were more than 69 unique brands in the sample, with the top six brands accounting for nearly half the sample.

Current Model

Table 1 presents the details of the estimation of the current model used to quality adjust men’s underwear.

Table 1. Parameter estimates for the hedonic regression for men's underwear
Variable Name	DF	Parameter Estimate	Standard Error	T Statistic	Pr > \|t\|	Tolerance Statistic
Intercept	1	3.03594	0.04097	74.11	<.0001
Brand Category or Specific Brand: High/premium national	1	0.316	0.02527	12.51	<.0001	0.74177
Brand Category or Specific Brand: Brand #1	1	0.78483	0.06476	12.12	<.0001	0.93671
Brand Category or Specific Brand: Brand #2	1	0.3686	0.03376	10.92	<.0001	0.89048
Brand Category or Specific Brand: Brand #3	1	0.3193	0.04386	7.28	<.0001	0.86227
Brand Category or Specific Brand: Brand #4	1	-0.344	0.03526	-9.76	<.0001	0.57921
Brand Category or Specific Brand: Brand #5	1	-0.32257	0.069	-4.67	<.0001	0.66336
Brand Category or Specific Brand: Private/miscellaneous	1	-0.2563	0.06667	-3.84	0.0001	0.78757
Brand Category or Specific Brand: National		Base
Multipack (# of items included): Quantity	1	0.19902	0.01676	11.88	<.0001	0.09175
Multipack (# of items included): Quantity-squared	1	-0.01114	0.00215	-5.18	<.0001	0.10405
Style: Long underwear	1	0.63887	0.12733	5.02	<.0001	0.95504
Style: Briefs	1	-0.10912	0.024	-4.55	<.0001	0.90518
Style: Boxers, boxer briefs, trunks, and other styles		Base
Fiber: Nylon	1	0.00132	0.000525	2.52	0.0119	0.78429
Fiber: Spandex	1	0.00716	0.00277	2.58	0.01	0.38038
Fiber: Cotton	1	0.00061	0.0003	2.02	0.0434	0.4006
Fiber: Wool	1	0.00309	0.000877	3.53	0.0004	0.76609
Fiber: Rayon	1	0.00178	0.000369	4.81	<.0001	0.76303
Fiber: Other fiber	1	0.00533	0.00152	3.51	0.0005	0.94325
Fiber: Polyester		Base

Note: This model contains a control variable for type of business, but it is not used in adjustments.

Summary Notes

This is the first-ever CPI quality adjustment model for men’s underwear. It was made possible by the use of web scraped data to supplement the CPI sample. This means that far fewer men’s underwear substitutions will be deemed non-comparable and imputed so long as a model is in use.
- This is the first hedonic model created for CPI apparel that utilizes alternative data.
The most important specifications in evaluating substitutions for men’s underwear are brand, type, fiber content, and multipack quantity. All of these were included in the model.
- The model accounts for specific brands that deviate in price level from other similar brands. This allows CPI adjustments to more accurately account for these brands when they enter and exit the sample. They are marked above as “Brand #1,” “Brand #2,” etc. Note that they are not necessarily the most numerous brands in the sample.
- The model employs a CPI apparel first: quantity is directly incorporated into the hedonic model. This accounts for changes in how many pairs of underwear are included in a single package. But not only that, it includes a quantity-squared term, which allows the model to capture the diminishing marginal value of items in a multipack. (The more items in a multipack, the less each item tends to cost.)

Data

Access data for men's underwear, nightwear, swimwear and accessories in our online database.

Additional Information

Additional information may be obtained from the Consumer Price Index Information Office by email or calling 202-691-7000. Information on the CPI's overall methodology can be found in the BLS Handbook of Methods.

Last Modified Date: June 30, 2023