1. bookVolume 36 (2020): Edizione 4 (December 2020)
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Prima pubblicazione
01 Oct 2013
Frequenza di pubblicazione
4 volte all'anno
access type Accesso libero

Basic Statistics of Jevons and Carli Indices under the GBM Price Model

Pubblicato online: 10 Dec 2020
Volume & Edizione: Volume 36 (2020) - Edizione 4 (December 2020)
Pagine: 737 - 761
Ricevuto: 01 Nov 2020
Accettato: 01 Mar 2020
Dettagli della rivista
Prima pubblicazione
01 Oct 2013
Frequenza di pubblicazione
4 volte all'anno

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.


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