An official website of the United States government
United States Department of Labor
United States Department of Labor
The .gov means it's official.
Federal government websites often end in .gov or .mil. Before sharing sensitive information,
make sure you're on a federal government site.
The site is secure.
The
https:// ensures that you are connecting to the official website and that any
information you provide is encrypted and transmitted securely.
Office of Survey Methods Research
SHARE ON:
More Information
Published Year: 2005
Survey/Program(s): Consumer Price Index-Housing (CPI-Housing)
Catalog: Statistical Survey Paper
Download PDF
Comparison between Chained CPI‐U and Regular CPI‐U: All‐U.S. Indexes at Lower Item‐aggregate Levels (2000—2003)
Abstract
In February 2005, the BLS calculated and published its third annual set of C-CPI-U indexes—-for 2003. The C-CPI-U (Chained - Consumer Price Index - Urban) is calculated and published every year, with a one-year lag, using a Tornqvist formula. Its set of weights are updated yearly, so a unique set of monthly weights is available for both time t as well as for time t-n. The C-CPI-U can thus be labeled a "superlative" index. By contrast, the regular CPI-U uses weights that are, at a minimum, at least two years old. It also uses a combination (hybrid) of Geomeans and Laspeyres formulas as its final estimator. For 12-month price changes, the All-US-All-Items chained C-CPI-U index results continue to diverge (significantly lower) from regular CPI-U index results, but the divergences at the lower aggregate levels (major group level and then lower) are not significantly different, except in a few isolated item groups. In this paper, we investigate the nature of these lower-level divergences using newly calculated chained C-CPI-U standard errors to construct our confidence intervals.