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The BLS Response to the Boskin Commission Report

Author

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  • John S. Greenlees

Abstract

The 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.

Suggested Citation

  • John S. Greenlees, 2006. "The BLS Response to the Boskin Commission Report," International Productivity Monitor, Centre for the Study of Living Standards, vol. 12, pages 23-41, Spring.
    • Handle: RePEc:sls:ipmsls:v:12:y:2006:3
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    References listed on IDEAS

    as
    1. 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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    Citations

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    Cited by:

    1. Marshall Reinsdorf & Jack E. Triplett, 2009. "A Review of Reviews: Ninety Years of Professional Thinking About the Consumer Price Index," NBER Chapters, in: Price Index Concepts and Measurement, pages 17-83, National Bureau of Economic Research, Inc.
    2. Robert J. Gordon, 2006. "The Boskin Commission Report: A Retrospective One Decade Later," International Productivity Monitor, Centre for the Study of Living Standards, vol. 12, pages 7-22, Spring.
    3. Shiratsuka, Shigenori, 2021. "Lower-Level Substitution Bias in the Japanese Consumer Price Index: Evidence from Government Micro Data," Discussion Paper Series 722, Institute of Economic Research, Hitotsubashi University.

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    More about this item

    Keywords

    United States; Boskin Commission; Boskin; Measurement; Prices; Consumer Price Index; CPI; Bias; CPI Bias; Consumer Price Index Bias;
    All these keywords.

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O51 - Economic Development, Innovation, 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; Data Access
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
    • C80 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - General
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes

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