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The Distribution of Inflation among Austrian Households

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Abstract

We estimate the distribution of household-level inflation and show a strong and stable negative relationship between income and inflation that reflects the differences in consumption bundles along the income distribution (2010–2012). Inflation decreases as education levels increase. It is especially high for blue-collar worker households and extraordinarily low for farmer households and shows a u-shaped relationship with age. Our findings question the exclusive focus of economic policymakers on the consumer price index based on a mean consumption bundle in times of diverging price developments. We advocate monitoring inflation of a broader range of real household level consumption bundles, such as inflation across the entire range of household incomes. We use the Austrian consumer survey (2009/10) as well as disaggregated price data to calculate inflation for given consumption bundles at the household level.

Suggested Citation

  • Pirmin Fessler & Friedrich Fritzer, 2013. "The Distribution of Inflation among Austrian Households," Monetary Policy & the Economy, Oesterreichische Nationalbank (Austrian Central Bank), issue 3, pages 12-28.
    • Handle: RePEc:onb:oenbmp:y:2013:i:3:b:2
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    File URL: https://www.oenb.at/dam/jcr:17a92972-3d27-480a-a939-f859b6413505/mop_2013_q3_analyse2.pdf
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    References listed on IDEAS

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    1. Peter Mooslechner & Helmut Stix & Karin Wagner, 2012. "The Use of Payment Instruments in Austria - A Study Based on Survey Data from 1996 to 2011," Monetary Policy & the Economy, Oesterreichische Nationalbank (Austrian Central Bank), issue 4, pages 53-77.
    2. Helmut Stix & Karin Wagner, 2006. "How Do Austrians Pay for Online Purchases?," Monetary Policy & the Economy, Oesterreichische Nationalbank (Austrian Central Bank), issue 3, pages 45-90.
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    Citations

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    Cited by:

    1. Kai Biehl & Judith Derndorfer & Franziska Disslbacher & Michael Ertl & Georg Feigl & Julia Hofmann & Markus Marterbauer & Patrick Mokre & Reinhold Russinger & Matthias Schnetzer & Jana Schultheiss & T, 2021. "Konsumerhebung und Verbraucherpreisindex – Herausforderungen für die amtliche Statistik in Pandemiezeiten," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 47(4), pages 457-468.
    2. Biljana Jovanovic & Marko Josimovski, 2021. "Income-specific inflation rates and the effects of monetary policy: the case of North Macedonia," Working Papers 2021-01, National Bank of the Republic of North Macedonia.
    3. Strasser, Georg & Messner, Teresa & Rumler, Fabio & Ampudia, Miguel, 2023. "Inflation heterogeneity at the household level," Occasional Paper Series 325, European Central Bank.
    4. Messner, Teresa & Rumler, Fabio, 2024. "Inflation heterogeneity across Austrian households. Evidence from household scanner data," Working Paper Series 2894, European Central Bank.
    5. Pirmin Fessler & Peter Lindner & Martin Schürz, 2016. "In focus: Eurosystem Household Finance and Consumption Survey 2014 – first results for Austria (second wave)," Monetary Policy & the Economy, Oesterreichische Nationalbank (Austrian Central Bank), issue 2, pages 34-95.
    6. Kiss, Regina & Strasser, Georg, 2024. "Inflation heterogeneity across households," Working Paper Series 2898, European Central Bank.

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    More about this item

    Keywords

    Inflation; household specific inflation; microdata; distribution;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access

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