Analysis
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All (3)
All (3) ((3 results))
- 1. The Impact on the CPI of Not Surveying House Prices in Rural Regions: A Sensitivity Analysis ArchivedArticles and reports: 62F0014M1997008Geography: Province or territoryDescription:
In light of a recent change in population coverage, this study was initiated to determine whether the integrity of the Consumer Price Index (CPI) should be questioned on the grounds that it does not explicitly take into account rural house price movements. An attempt is made here to quantify the potential impact, using various regimes of artificial data to represent house price movements for rural regions. The regimes were manufactured in a way that allowed the analysis of differences between urban and rural regions in terms of the evolution of house prices, as well as differences in their cumulative price index levels. Three provinces were considered: Newfoundland, Saskatchewan, and British Columbia, all of which have large rural populations. The study results were monthly indexes for the time period, January 1986 to December 1994. The general conclusion was that house prices in rural regions would have to move very differently from those in urban regions to affect the overall level of the CPI. However, in the case of lower-level aggregates the failure to include rural house prices could be having an important effect. In addition, even when cumulative house price movements for rural and urban regions are similar, differences in their evolution tend to have an effect on the trend of the CPI, especially in the case of lower-level aggregates. While it is tempting to conclude that the current CPI methodology is robust enough to apply to the expanded population, this would be based purely on conjecture about the nature of movements in rural house prices. Hence, a second phase of this study will be initiated, whose purpose will be to develop a methodology to construct price indexes for rural regions.
Release date: 1999-05-13 - 2. An Application of the Hedonic Approach to Clothing Items in the Consumer Price Index (CPI) ArchivedArticles and reports: 62F0014M1997009Geography: CanadaDescription:
A research program was recently initiated by Prices Division to explore the feasibility of using the hedonic approach for making quality adjustments in the Consumer Price Index (CPI) for clothing items. The current paper is the first of a series, which attempts to derive hedonic quality adjustments for Men's Dress Shirts. A database for quality characteristics is first constructed, from which two experimental hedonic models are estimated. One of these models is then used to produce hedonic quality adjustments for all shirt substitutions that have occurred subsequent to May 1995 up to June 1996. These values are then compared with the actual quality adjustments used in the official CPI. Although results are preliminary, three important conclusions can be made. First, quality adjustments derived using the hedonic versus the traditional approach are very different, at least at the level of individual substitutions. Which of the two approaches is more accurate, however, is not evident at this premature stage. Second, the integrity of the data on quality characteristics will have to improve greatly if the hedonic approach is ever to be considered as a viable alternative. Finally, improving the source data on quality characteristics would be of value whether or not the hedonic approach is adopted for making quality adjustments. One of the ways this could be done would be to adopt the checklist approach, which is the current procedure in the United States and in Sweden.
Release date: 1999-05-13 - Articles and reports: 62F0014M1998011Geography: CanadaDescription:
This paper is the second in a series reporting on the current progress of a study whose purpose is to explore the feasibility of using the hedonic approach for making quality adjustments to the Clothing component of the Consumer Price Index (CPI). In this phase of the study, two preliminary checklists were developed for obtaining prices and quality characteristics for Men's Dress Shirts and Men's Sports Jackets. These checklists were then used for data collection in the field on expanded CPI samples for the two items. To date, the resulting database for Men's Dress Shirts has been used to derive a hedonic model. The main conclusions that can be made at this point are: 1) checklists represent a certain improvement over the current method of reporting and should be developed for all clothing items in the CPI; 2) if the hedonic approach to quality adjustment in clothing is to be formally adopted then the CPI samples will have to be augmented, at least periodically to permit estimation; and 3) more experience is needed with the hedonic approach in research mode, using clothing items with more complexity, before we can say whether the hedonic approach should be formally adopted as an alternative to our current method of quality adjustment for clothing items.
Release date: 1999-05-13
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Articles and reports (3)
Articles and reports (3) ((3 results))
- 1. The Impact on the CPI of Not Surveying House Prices in Rural Regions: A Sensitivity Analysis ArchivedArticles and reports: 62F0014M1997008Geography: Province or territoryDescription:
In light of a recent change in population coverage, this study was initiated to determine whether the integrity of the Consumer Price Index (CPI) should be questioned on the grounds that it does not explicitly take into account rural house price movements. An attempt is made here to quantify the potential impact, using various regimes of artificial data to represent house price movements for rural regions. The regimes were manufactured in a way that allowed the analysis of differences between urban and rural regions in terms of the evolution of house prices, as well as differences in their cumulative price index levels. Three provinces were considered: Newfoundland, Saskatchewan, and British Columbia, all of which have large rural populations. The study results were monthly indexes for the time period, January 1986 to December 1994. The general conclusion was that house prices in rural regions would have to move very differently from those in urban regions to affect the overall level of the CPI. However, in the case of lower-level aggregates the failure to include rural house prices could be having an important effect. In addition, even when cumulative house price movements for rural and urban regions are similar, differences in their evolution tend to have an effect on the trend of the CPI, especially in the case of lower-level aggregates. While it is tempting to conclude that the current CPI methodology is robust enough to apply to the expanded population, this would be based purely on conjecture about the nature of movements in rural house prices. Hence, a second phase of this study will be initiated, whose purpose will be to develop a methodology to construct price indexes for rural regions.
Release date: 1999-05-13 - 2. An Application of the Hedonic Approach to Clothing Items in the Consumer Price Index (CPI) ArchivedArticles and reports: 62F0014M1997009Geography: CanadaDescription:
A research program was recently initiated by Prices Division to explore the feasibility of using the hedonic approach for making quality adjustments in the Consumer Price Index (CPI) for clothing items. The current paper is the first of a series, which attempts to derive hedonic quality adjustments for Men's Dress Shirts. A database for quality characteristics is first constructed, from which two experimental hedonic models are estimated. One of these models is then used to produce hedonic quality adjustments for all shirt substitutions that have occurred subsequent to May 1995 up to June 1996. These values are then compared with the actual quality adjustments used in the official CPI. Although results are preliminary, three important conclusions can be made. First, quality adjustments derived using the hedonic versus the traditional approach are very different, at least at the level of individual substitutions. Which of the two approaches is more accurate, however, is not evident at this premature stage. Second, the integrity of the data on quality characteristics will have to improve greatly if the hedonic approach is ever to be considered as a viable alternative. Finally, improving the source data on quality characteristics would be of value whether or not the hedonic approach is adopted for making quality adjustments. One of the ways this could be done would be to adopt the checklist approach, which is the current procedure in the United States and in Sweden.
Release date: 1999-05-13 - Articles and reports: 62F0014M1998011Geography: CanadaDescription:
This paper is the second in a series reporting on the current progress of a study whose purpose is to explore the feasibility of using the hedonic approach for making quality adjustments to the Clothing component of the Consumer Price Index (CPI). In this phase of the study, two preliminary checklists were developed for obtaining prices and quality characteristics for Men's Dress Shirts and Men's Sports Jackets. These checklists were then used for data collection in the field on expanded CPI samples for the two items. To date, the resulting database for Men's Dress Shirts has been used to derive a hedonic model. The main conclusions that can be made at this point are: 1) checklists represent a certain improvement over the current method of reporting and should be developed for all clothing items in the CPI; 2) if the hedonic approach to quality adjustment in clothing is to be formally adopted then the CPI samples will have to be augmented, at least periodically to permit estimation; and 3) more experience is needed with the hedonic approach in research mode, using clothing items with more complexity, before we can say whether the hedonic approach should be formally adopted as an alternative to our current method of quality adjustment for clothing items.
Release date: 1999-05-13
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