ERIC Number: ED171632
Record Type: RIE
Publication Date: 1979-Apr
Reference Count: 0
Measuring Price Changes: A Study of the Price Indexes. Fourth Edition.
Wallace, William H.; Cullison, William E.
This three-part monograph examines the major price indexes used to measure the intensity of inflation. The first part discusses the recent behavior of prices as measured by the Consumer Price Index (commodities, goods, and services), the Producer Price Index (wholesale prices of crude materials, intermediate materials, supplies, components, and finished goods), and the Implicit Price Deflator for the Gross National Product (GNP). The severity of the current inflation problem and the importance of good measures of price changes are emphasized. The second part explains the concept of a price index, reviews the criteria that a good index must satisfy, and discusses conceptual and statistical problems of design and construction. The final part describes characteristics and explains recent revisions of each of the indexes. The Consumer Price Index, revised in 1978, is noted as having the most effect on daily business decisions throughout the country. Prices are observed in 85 areas and separate indexes are computed in 28 cities. The oldest continually published measurement, the Producer Price Index, covers about 2800 commodities. Finally, both previously discussed indexes are explained in terms of their influence on the Implicit Deflator Index for the GNP in which consumer expenditure of the GNP is adjusted for price change. (Author/KC)
Publication Type: Guides - Non-Classroom; Guides - Classroom - Learner
Education Level: N/A
Authoring Institution: Federal Reserve Bank of Richmond, VA.