5 ms·

CPI is almost certainly gamed. http://www.shadowstats.com/alternate_data/inflation-charts http://www.shadowstats.com/alternate_data/inflation-charts

clavicat 5y ago
ShadowStats is a crude derivative of CPI data so it’s gamed squared.
fddhjjj 5y ago
Shadows stats has faced some criticism https://econbrowser.com/archives/2008/09/shadowstats_deb https://econbrowser.com/archives/2008/09/shadowstats_deb Some wags have pointed out the price has been constant for many years https://web.archive.org/web/20080512223437/http://www.shadowstats.com/subscriptions https://web.archive.org/web/20080512223437/http://www.shadow... The billion prices project independently collects prices and matches CPI well https://www.businessinsider.com/million-prices-project-vs-the-cpi-2012-3 https://www.businessinsider.com/million-prices-project-vs-th... Note that the inflation stats in Argentina *were* manipulated and official numbers differed from billion prices. https://en.wikipedia.org/wiki/MIT_Billion_Prices_project https://en.wikipedia.org/wiki/MIT_Billion_Prices_project
Robotbeat 5y ago
Is it? Can’t game it much or for long without being obvious because it’s compounding. Let’s say inflation is understated by 4% absolute per year. Over 40 years, that’s a factor of 4. https://inflationdata.com/articles/inflation-adjusted-prices/inflation-adjusted-gasoline-prices/ https://inflationdata.com/articles/inflation-adjusted-prices... Is the fuel cost per mile traveled 4 times higher than it was in 1981? No. Fuel prices adjusted for CPI are about identical with what they were in 1981 ($3.80/gallon): https://inflationdata.com/articles/inflation-adjusted-prices/inflation-adjusted-gasoline-prices/ https://inflationdata.com/articles/inflation-adjusted-prices... And fuel efficiency has improved by about 40% in that time: https://www.epa.gov/automotive-trends/highlights-automotive-trends-report https://www.epa.gov/automotive-trends/highlights-automotive-... (Even as vehicle reliability and safety and comfort have also gone up.)
- clavicat 5y ago
  Fuel would be hard to game. It’s just fuel. Other components are trickier to calculate, like aggregate food prices or things involving hedonic regression. If there is gaming, you’d have to look at the tricky parts.
  - Robotbeat 5y ago
    Well if you don’t think we’ve gamed fuel but do think we’ve gamed CPI significantly (ie several percentage points per year for decades), then we have made REMARKABLE progress in reducing fuel costs over the last 40 years, with fuel efficiency improvements on top of that.
    - clavicat 5y ago
      I don’t doubt that. Oil was expensive in the seventies for geopolitical reasons. Production has since become much more predictable and secure.
  - midasuni 5y ago
    Since 2010 the cost of bread and milk has increased below CPI, and in general food at home has been below inflation too

clavicat 5y ago

ShadowStats is a crude derivative of CPI data so it’s gamed squared.

fddhjjj 5y ago

Shadows stats has faced some criticism https://econbrowser.com/archives/2008/09/shadowstats_deb https://econbrowser.com/archives/2008/09/shadowstats_deb Some wags have pointed out the price has been constant for many years https://web.archive.org/web/20080512223437/http://www.shadowstats.com/subscriptions https://web.archive.org/web/20080512223437/http://www.shadow... The billion prices project independently collects prices and matches CPI well https://www.businessinsider.com/million-prices-project-vs-the-cpi-2012-3 https://www.businessinsider.com/million-prices-project-vs-th... Note that the inflation stats in Argentina *were* manipulated and official numbers differed from billion prices. https://en.wikipedia.org/wiki/MIT_Billion_Prices_project https://en.wikipedia.org/wiki/MIT_Billion_Prices_project

Robotbeat 5y ago

Is it? Can’t game it much or for long without being obvious because it’s compounding. Let’s say inflation is understated by 4% absolute per year. Over 40 years, that’s a factor of 4. https://inflationdata.com/articles/inflation-adjusted-prices/inflation-adjusted-gasoline-prices/ https://inflationdata.com/articles/inflation-adjusted-prices... Is the fuel cost per mile traveled 4 times higher than it was in 1981? No. Fuel prices adjusted for CPI are about identical with what they were in 1981 ($3.80/gallon): https://inflationdata.com/articles/inflation-adjusted-prices/inflation-adjusted-gasoline-prices/ https://inflationdata.com/articles/inflation-adjusted-prices... And fuel efficiency has improved by about 40% in that time: https://www.epa.gov/automotive-trends/highlights-automotive-trends-report https://www.epa.gov/automotive-trends/highlights-automotive-... (Even as vehicle reliability and safety and comfort have also gone up.)

clavicat 5y ago
Fuel would be hard to game. It’s just fuel. Other components are trickier to calculate, like aggregate food prices or things involving hedonic regression. If there is gaming, you’d have to look at the tricky parts.
- Robotbeat 5y ago
  Well if you don’t think we’ve gamed fuel but do think we’ve gamed CPI significantly (ie several percentage points per year for decades), then we have made REMARKABLE progress in reducing fuel costs over the last 40 years, with fuel efficiency improvements on top of that.
  - clavicat 5y ago
    I don’t doubt that. Oil was expensive in the seventies for geopolitical reasons. Production has since become much more predictable and secure.
- midasuni 5y ago
  Since 2010 the cost of bread and milk has increased below CPI, and in general food at home has been below inflation too