budget shares from data that CE provides” (Casey, 2010, p. 1). BLS publishes indexes on a monthly basis for different categories of products and services. Casey (2010) provided an in-depth description of the use of CE data by the CPI program. Most of the particulars included in this section are based on that paper.

The CPI program currently produces four indexes. The CPI-U is the most comprehensive index, measuring price changes for all urban consumers.1 A second index, the CPI-W, restricts that target population to the subset of urban consumer units in which the majority of income is earned in wage-earning or clerical occupations. A third index, the C-CPI-U, has the same population coverage as the CPI-U. Unlike the CPI-U, however, it uses an index formula that accounts for changes in consumer spending patterns in response to changes in relative prices at all levels of index construction. A fourth index, the CPI-E, is an experimental measure that reflects the spending patterns of urban consumer units in which the reference person is 62 years of age or older.

Types of Data Required by the CPI

Currently, the CE provides the CPI with expenditure data for urban consumer units, along with the demographic information necessary to implement the coverage definitions of the indexes described above.

Demographic Data

For the CPI-U, the CE must (1) allow the identification of urban consumer units and (2) support the construction of subnational CPIs. Additional information is required on sources of income, the percent of income from different sources, and the age of the reference person in the consumer unit, in order to construct the CPI-W and the CPI-E, respectively. Finally, information on the housing tenure of the consumer is necessary for calculating expenditures on the components of shelter cost. Although no other demographic information is required for the current set of CPIs, Casey (2010) states that CPI researchers find additional demographic data useful for constructing other experimental indexes and pursuing other research.

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1The CPI-U does not include the spending patterns of people living in rural nonmetropolitan areas, farm families, people in the Armed Forces, and those in institutions, such as prisons and mental hospitals.



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