Various fields of economic analysis (e.g., growth and productivity) and economic policy (e.g., monetary and social policy) rely on accurate measures of price change. Unfortunately, the price index formulae that most price statisticians consider as particularly accurate - the superlative indices...

We develop a new approach to measuring the cost of living for constant elasticity of substitution (CES) preferences. Our approach allows for demand shocks for individual goods (to rationalize micro data) while preserving a money-metric expenditure function (to compare the cost of living over...

The U.S. CPI is based on the Laspeyres price index, an index type that has an upward "substitution bias." Thus, the CPI tends to overstate increases in the cost of living. To address this bias, the Advisory Commission to Study the Consumer Price Index recommended adopting for the CPI a...