The BLS Response to the Boskin Commission Report
AbstractThe author provides a BLS response to the Boskin Commission from the perspective of ten years following the release of the report. He documents the research on price indexes done at the BLS in the first half of the 1990s that pointed to upward CPI bias, and discusses how these results eventually lead to the appointment of the Boskin Commission in 1995. He also provides a detailed discussion of the methodological changes to the CPI made by the BLS between 1996 and 2002 in three areas corresponding to the categories of bias identified by the Commission: upper and lower level substitution bias, quality change and new products,and outlet bias. These changes included the introduction of a chained CPI (CCPI-U), the introduction of more hedonic models and the recognition of the need to use a product and outlet sample that was as representative as possible of current consumer spending patterns. He concludes that the Boskin Commission, by forcing the BLS to scrutinize the strengths and limitations of its CPI procedures and by highlighting and publicizing the budgetary impacts of the CPI, paved the way for various CPI improvements.
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Bibliographic InfoArticle provided by Centre for the Study of Living Standards in its journal International Productivity Monitor.
Volume (Year): 12 (2006)
Issue (Month): (Spring)
Find related papers by JEL classification:
- O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
- O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada
- C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data
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- B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
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- E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
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- Brent R. Moulton, 1996. "Bias in the Consumer Price Index: What Is the Evidence?," Journal of Economic Perspectives, American Economic Association, vol. 10(4), pages 159-177, Fall.
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