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## At What Price?: Conceptualizing and Measuring Cost-of-Living and Price Indexes (2002) Commission on Behavioral and Social Sciences and Education (CBASSE)

### Citation Manager

. "9 Data Collection for CPI Construction." At What Price?: Conceptualizing and Measuring Cost-of-Living and Price Indexes. Washington, DC: The National Academies Press, 2002.

 Page 280

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At What Price?: Conceptualizing and Measuring Cost-of-Living and Price Indexes

estimates the Rthz. An oversimplified version of the BLS procedure is the following: Let a sample of N items be drawn from the universe of items in item stratum z (with replacement), with the probability of selection of item i equal to whi. Then

is an unbiased estimate of the weighted average version of Rthz, and

is a consistent estimator of the geometric mean version of Rthz.

The BLS then updates its index for this basic stratum by the chaining formula described earlier, namely,

These indexes are aggregated to form indexes for aggregate areas (e.g., U.S. cities), aggregate items (e.g., expenditure classes), or both. Let H denote the aggregate area and Z the aggregate item for which an index is to be formed. The index for this aggregate area and item is calculated as

where

and

where jez denotes the items drawn from the universe of items in item stratum j.

#### Consumer Expenditure Survey

The CEX, sponsored by BLS and conducted by the Bureau of the Census, is a national probability sample of household units. It is comprised of two parts, a Quarterly Interview Panel Survey and a Diary Survey. Each “consumer unit” in the household selected for the Quarterly Interview Panel Survey is interviewed for 5 consecutive quarters about relatively large expenditure items (e.g., major appliances) and expenditures that occur at regular intervals (e.g., utility bills). A sample of 8,910 addresses are contacted for the Quarterly Interview Panel Survey in each of the calendar quarters, and the number of completed interviews per quarter is targeted at 6,160. Each consumer unit selected for the Diary Survey completes a diary on expenditure information on frequently purchased items and

 Page 280
 Front Matter (R1-R16) Executive Summary (1-12) 1 Introduction (13-37) 2 Conceptual Foundations for Price and Cost-of-Living Indexes (38-93) 3 Index Domain (94-105) 4 Evolving Market Baskets: Adjusting Indexes to Account for Quality Change (106-154) 5 New Goods and New Outlets (155-177) 6 The Special Case of Medical Services (178-190) 7 Index Design and Index Purpose (191-221) 8 Whose Index? Aggregating Across Households (222-251) 9 Data Collection for CPI Construction (252-282) Appendix: Statistical Definition and Estimation of Price Indexes (283-292) References (293-306) Glossary (307-314) Biographical Sketches of Panel Members and Staff (315-318) Index (319-332)