Policymakers tend to focus on core inflation measures because they are thought to be better predictors of total … inflation over time horizons of import to policymakers. The authors find little support for this assumption. While some measures … of core inflation are less volatile than total inflation, core inflation is not necessarily the best predictor of total …

this has on the measurement of inflation. Using a large US scanner data set on supermarket products and applying flexible … introduces a systematic bias in the measurement of inflation. For our data we find that the life cycle bias underestimates the … measurement of inflation by around 0.30 percentage points each year …

Official price indexes, such as the CPI, are imperfect indicators of inflation calculated using ad hoc price formulae … different from the theoretically well-founded inflation indexes favored by economists. This paper provides the first estimate of … how accurately the CPI informs us about "true" inflation. We use the largest price and quantity dataset ever employed in …

existing work by presenting an alternative approach to measure the rate of inflation. This approach has been demonstrated using …

(permanent change in the mean inflation rate). These datasets were used to test the performance of alternative underlying … inflation measures. We found that the benchmark underlying inflation measures (based on unobserved trend extraction) are more … underlying inflation measure …

under-weighted, but the under-weighting remains fairly stable over time so that inflation measurement is not signi ficantly … both the representativeness of prices included in the CPI and on estimates of inflation. We use high-frequency scanner data …

time so that inflation measurement is not significantly affected. In addition, we find evidence that the typical practice … estimates of inflation. We use high-frequency scanner data from US supermarkets to explore if there is any systematic …

Two rationales offered for policymakers' focus on core measures of inflation as a guide to underlying inflation are … that core inflation omits food and energy prices, which are thought to be more volatile than other components, and that … core inflation is thought to be a better predictor of total inflation over time horizons of import to policymakers. The …