The paper seeks to obtain an optimal asymmetric trimmed mean-based core inflation measure in the class of trimmed mean …

Trimmed-mean Personal Consumption Expenditure (PCE) inflation does not clearly dominate ex-food-and-energy PCE … inflation in real-time forecasting of headline PCE inflation. However, trimmed-mean inflation is the superior communications and … policy tool because it is a less-biased real-time estimator of headline inflation and because it more successfully filters …

This paper provides an extensive literature review and analyses some open issues in the measurement of inflation that … quantification of potential biases. Two such biases are the substitution bias and the quality adjustment bias. Most analyses of … substitution bias rest on the concept of the cost of living, positing that preferences are stable, homogeneous and homothetic …