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How the Effects of Inflation on Households Varied by Income, 1984 to 2022: Working Paper 2025-04

Author

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  • Dorian Carloni

Abstract

Households at different points in the income distribution consume different bundles of goods and services. Changes in the prices of those goods and services differ from year to year, causing variations (on an annual basis and over longer periods) in the price of a typical consumption bundle purchased by households at different income levels. In this paper, the Congressional Budget Office estimates how the price of households' consumption bundles changed between 1984 and 2022. To do so, CBO used publicly available data from the Consumer Expenditures Survey and imputed

Suggested Citation

  • Dorian Carloni, 2025. "How the Effects of Inflation on Households Varied by Income, 1984 to 2022: Working Paper 2025-04," Working Papers 61549, Congressional Budget Office.
    • Handle: RePEc:cbo:wpaper:61549
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    File URL: https://www.cbo.gov/system/files/2025-08/61549-Inflation.pdf
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    References listed on IDEAS

    as
    1. Jaravel, Xavier, 2024. "Distributional Consumer Price Indices," CEPR Discussion Papers 19802, Centre for Economic Policy Research.
    2. Marina Gindelsky & Robert Martin, 2025. "The Polarization of Personal Saving," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 71(1), February.
    3. David R Baqaee & Ariel T Burstein & Yasutaka Koike-Mori, 2024. "Measuring Welfare by Matching Households across Time," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 139(1), pages 533-573.
    4. Gary Cornwall & Marina Gindelsky, 2025. "Nowcasting Distributional National Accounts for the United States: A Machine Learning Approach," AEA Papers and Proceedings, American Economic Association, vol. 115, pages 79-84, May.
    5. Xavier Jaravel & Danial Lashkari, 2024. "Measuring Growth in Consumer Welfare with Income-Dependent Preferences: Nonparametric Methods and Estimates for the United States," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 139(1), pages 477-532.
    6. David Argente & Munseob Lee, 2021. "Cost of Living Inequality During the Great Recession," Journal of the European Economic Association, European Economic Association, vol. 19(2), pages 913-952.
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    More about this item

    JEL classification:

    • D30 - Microeconomics - - Distribution - - - General
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

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