Lodging away from home, a component of the other
lodging away from home including hotels and
motels index, is included in the shelter index of the
Consumer Price Index. The other lodging away from
home including hotels and motels index is published on
a monthly basis for all the areas for which CPI data
are published. It includes the three components shown
below with the relative importance of each index.
These data are from the December 2007, U.S. city average
of the All Urban Consumers Price Index (CPI-U):
Lodging away from home, a component of the other
Item |
Relative Importance |
Lodging away from home |
2.564 |
Housing at school |
0.148 |
Other lodging away from home including hotels and motels |
2.416 |
Other lodging away from home including hotels and motels has approximately 94
percent of the weight of the lodging away from home index. This is by far the
largest component of the index, and is published
separately at the U.S. level.
The base period weight for each CPI item group is
the out-of-pocket expenditures households incurred for
that item in 2005-2006. The weight for rental of lodging
away from home reflects household expenditures for
lodging while on vacations, visiting family and friends, or
attending to personal business. In addition, the weight
reflects the rental value of owned vacation homes. The CPI
includes short-term rental accommodations available to
the general public. Long-term rentals intended for
year-round residence or rentals available only to large groups,
institutions, and businesses are excluded from the index.
The sample of outlets for the lodging away from
home index reflects actual expenditures for out of town
lodging as reported by respondents residing in the CPI's 87
sampling areas. However, because these expenditures
are made all over the country, not just in the 87 pricing areas,
hotels and motels are priced for rentals of lodging
away from home throughout the United States. The most
recent revision of the CPI, first published in January
1998, further improved sampling, data collection,
processing, and statistical estimation. Many of the samples
underlying the CPI were replaced. These samples included
geographic areas, items selected for pricing, and outlets
in which items are priced.
Estimates of price change for lodging establishments
are often quite volatile because the sample establishments
tend to be located in vacation areas (such as beaches, ski
resorts, or other areas) with significant seasonal
pricing patterns. For this reason, the current sample size is
approximately 4370 quotes.
Selection of characteristics to be priced
When CPI economic assistants seek prices for rental
of lodging away from home, they first select the major price-determining characteristics of the stay.
The type of room and the view from the room are examples
of price-determining characteristics. Using
probability sampling, all of the room options (such as suite,
deluxe, standard, etc.) are given their appropriate chance for
selection. Once a room is selected, then the many
characteristics associated with the room/hotel are identified
to ensure that the same situation is priced each
collection period, or if there is a change in the situation,
that change can readily be identified. The following is an
example of characteristic information that would
be identified:
Occupancytwo adults;
Type of accommodationdeluxe room;
Room classification/locationocean view, room 306;
Time of stayweekend;
Length of stayone night;
Bathroom facilitiesone full bathroom;
Kitchen facilitiesnone;
Televisionone, includes free movie channel;
Telephoneone telephone, free local calls;
Air-conditionedyes;
Meals includedbreakfast;
Parkingfree self parking;
TransportationTransportation to airport, no charge;
Recreation facilitiesan indoor and an outdoor pool,
a private beach, three tennis courts, and an exercise room.
Quality Changes
One of the most difficult problems for the CPI is to
accurately quantify changes in the quality of items and
to factor these quality changes out of the items' price
movements. Once a BLS economic assistant selects an
item for the CPI, and describes it by enumerating all of
its quality-determining attributes, then each successive
time an economic assistant collects the item's price a
comparison of its current characteristics is made to that of
its previous description. If any of its characteristics
change, a quality improvement or deterioration may have
occurred. In addition, because quality change often
accompanies price change, when the price of an item
changes significantly, the economic assistant asks the
respondent to identify a cause.
When there are changes in an item's characteristics or
significant changes in its price, an analyst in the
national office carefully reviews the collected data. Then,
using information from the economic assistant and
knowledge about the market for the item, the analyst determines if
a quality change has occurred. If so, and if the analyst
can identify the value of the quality change, the value of
that quality change is removed prior to calculation of the
index. However, if the quality change is significant,
and the analyst cannot determine its value, that item is
not used in calculating the index for the month and the
quality change is reported. For example, suppose a
hotel room selected previously now includes
complimentary breakfast and dinner, has been renovated, and now
includes a VCR. The price of the room has increased,
and the price change is strictly due to these enhancements.
This change in price, due to the change in quality of
the services provided, would not be reflected in the index.
Additional information
Additional information on the Consumer Price Index
can be found in the BLS Handbook of Methods,
chapter 17, "The Consumer Price Index," Bulletin 2490 (1997).
This chapter is also available on the BLS Internet site
(http://www.bls.gov) under the topic "Publications," or you
may call the Information and Analysis Section of the CPI
at (202) 691-7000.
Last Modified Date: March 28, 2008