Department of Labor Logo United States Department of Labor
Dot gov

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.

Https

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.

Bureau of Labor Statistics > Office of Survey Methods and Research > Publications > Browse Research Papers

Comparison of Chained CPI‐U and Regular CPI‐U All‐U.S. Indexes in the Housing Sector (2000—2004)

Owen J. Shoemaker

Abstract

In February, 2006, the BLS calculated and published its fourth annual set of C-CPI-U indexes —- for the 12 months of 2004. The C-CPI-U (Chained Consumer Price Index - Urban) is calculated and published every year, with a one year lag, using a Tornqvist formula, which is a Superlative index formula. By contrast, the regular CPI-U 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 in the Housing Sector (Rent plus Owners' Equivalent Rent, or REQ) the Superlative results have begun to track consistently higher than their Regular CPI results. We investigate the anomalous nature of these Housing results, and discover that a mathematical result rather than index theory is determinative.