Consumer Price Index. Does the Price Collection Frequency Matter? Some Monte Carlo Results.

In this paper, we examine the effects of data collection frequency on the computation of the Consumer Price Index (CPI). Using stochastic simulation techniques, we conclude that the frequency of data collection has a considerable effect on CPI values. Our findings confirm the need for high levels of data collection frequency for the purpose of computing the CPI and, in general, for the more effective monitoring of developments in the cost of living, as this is approached on the basis of Consumer Price Index values.