American Living Standards, 1888-1994: Evidence From Consumer Expenditures
I use micro data on food and recreation expenditures from 1888 to 1994 to provide the first estimates of overall CPI bias prior to the 1970s and new estimates of bias since the 1970s and to reassess long-run growth rates. I find that CPI bias was -0.1 percentage points per year between 1888 and 1919 and rose to 0.7 percentage points per year between 1919 and 1935. CPI bias was low in the 1950s and 0.3 percentage points per year in the 1960s and then rose to 2.7 percentage points per year between 1973 and 1982 before falling to 0.6 percentage points per year between 1983 and 1994. Inadequately accounting for the introduction of new consumer goods probably was the biggest source of bias between 1919 and 1935. Revised growth rates suggest that despite the Great Depression real per capita personal income was not falling but was rising by 0.5 percentage points per year between 1919 and 1935 and that growth rates were not stagnant in the 1970s but were almost as high as in the 1960s (4.0 and 3.2 in the 1960s and 1970s, respectively).
|Date of creation:||Apr 2000|
|Date of revision:|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- J. A. Hausman & W. K. Newey & J. L. Powel, 1988.
"Nonlinear Errors in Variables: Estimation of Some Engel Curves,"
504, Massachusetts Institute of Technology (MIT), Department of Economics.
- Hausman, J. A. & Newey, W. K. & Powell, J. L., 1995. "Nonlinear errors in variables Estimation of some Engel curves," Journal of Econometrics, Elsevier, vol. 65(1), pages 205-233, January.
- Martin Neil Baily, 1981. "Productivity and the Services of Capital and Labor," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 12(1), pages 1-66.
- Bruce W Hamilton, 1998. "The True Cost of Living: 1974 - 1991," Economics Working Paper Archive 395, The Johns Hopkins University,Department of Economics.
- Michael J. Boskin, 1998. "Consumer Prices, the Consumer Price Index, and the Cost of Living," Journal of Economic Perspectives, American Economic Association, vol. 12(1), pages 3-26, Winter.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:7650. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.