1. bookVolumen 36 (2020): Edición 4 (December 2020)
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2001-7367
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01 Oct 2013
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Basic Statistics of Jevons and Carli Indices under the GBM Price Model

Publicado en línea: 10 Dec 2020
Volumen & Edición: Volumen 36 (2020) - Edición 4 (December 2020)
Páginas: 737 - 761
Recibido: 01 Nov 2020
Aceptado: 01 Mar 2020
Detalles de la revista
License
Formato
Revista
eISSN
2001-7367
Primera edición
01 Oct 2013
Calendario de la edición
4 veces al año
Idiomas
Inglés
Abstract

Most countries use either the Jevons or Carli index for the calculation of their Consumer Price Index (CPI) at the lowest (elementary) level of aggregation. The choice of the elementary formula for inflation measurement does matter and the effect of the change of the index formula was estimated by the Bureau of Labor Statistics (2001). It has been shown in the literature that the difference between the Carli index and the Jevons index is bounded from below by the variance of the price relatives. In this article, we extend this result, comparing expected values and variances of these sample indices under the assumption that prices are described by a geometric Brownian motion (GBM). We provide formulas for their biases, variances and mean-squared errors.

Keywords

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