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Consumer Price Inflation across the Income Distribution in South Africa

  • Morné Oosthuizen

    ()

    (Development Policy Research Unit, University of Cape Town)

Abstract: By monitoring the price changes experienced by some representative household, consumer price indices provide an important measure of changing purchasing power within a given economy. Group price indices offer one method of more accurately reflecting the inflation experiences of specific types of households, such as poor households, elderly households or households with children, for example. This study uses expenditure data from the 2000 Income and Expenditure Survey and price indices from Statistics South Africa to calculate inflation rates for expenditure deciles for the period 1998 to 2006. As a result, price indices and inflation rates calculated on the basis of these weights can not accurately reflect the rates of inflation experienced by what would be viewed as the ‘average’ household.

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File URL: http://www.dpru.uct.ac.za/sites/default/files/image_tool/images/36/DPRU%20WP07-129.pdf
File Function: First version, 2007
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Paper provided by University of Cape Town, Development Policy Research Unit in its series Working Papers with number 07129.

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Length: 71 pages
Date of creation: Nov 2007
Date of revision:
Publication status: Published in Working Paper Series by the Development Policy Research Unit, November2007, pages 1-71
Handle: RePEc:ctw:wpaper:07129
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  1. Michael, Robert T, 1979. "Variation across Households in the Rate of Inflation," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 11(1), pages 32-46, February.
  2. Hagemann, Robert P, 1982. "The Variability of Inflation Rates across Household Types," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 14(4), pages 494-510, November.
  3. Bart Hobijn & David Lagakos, 2005. "Inflation Inequality In The United States," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 51(4), pages 581-606, December.
  4. Angus Deaton, 1998. "Getting Prices Right: What Should Be Done?," Journal of Economic Perspectives, American Economic Association, vol. 12(1), pages 37-46, Winter.
  5. Eduardo Ley, 2005. "Whose inflation? A characterization of the CPI plutocratic gap," Oxford Economic Papers, Oxford University Press, vol. 57(4), pages 634-646, October.
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