June 21, 1999 (The Editor’s Desk is updated each business day.)
New research series shows lower
inflation
Using current methods of calculation, the Consumer Price
Index for All Urban Consumers (CPI-U) would have grown more slowly in the past 20 years.
The average rate of inflation based on a new research series was about half a percentage
point lower than the official rate in 1978-98.
![Percent change in the Consumer Price Index (CPI-U) minus the percent change in the Consumer Price Index research series using current methods (CPI-U-RS)](https://webarchive.library.unt.edu/web/20120925101850im_/http://www.bls.gov/opub/ted/images/1999/Jun/wk4/art01.gif)
[Chart data—TXT]
In a new BLS study, the CPI-U was re-computed for 1978-98 using the latest methods. The
resulting research series, dubbed the CPI-U-RS, rose by 4.28 percent per year on average
over that period, compared with 4.73 percent for the CPI-U. As shown in the chart, in
every year except 1982, the CPI-U increased by more than the research series.
BLS has made numerous improvements to the CPI over the years, which have increased the
accuracy of the index; however, the official historical price indexes are not adjusted to
reflect the improvements. The research series attempts to answer the question: "What
would have been the measured rate of inflation from 1978 forward had the methods currently
used in calculating the CPI-U been in use since 1978?"
CPI data are produced by the BLS Consumer Price Index
program. It is important to note that the CPI-U-RS has certain limitations and that it is
subject to revision. More information on the CPI-U-RS can be found in "CPI research series using current methods,
1978-98," by Kenneth J. Stewart and Stephen B. Reed, Monthly Labor Review
preprint, June 1999. Annual percent changes are December-to-December changes.
Of interest
Spotlight on Statistics: National Hispanic Heritage Month
In this Spotlight, we take a look at the Hispanic labor force—including labor force participation, employment and unemployment, educational attainment, geographic location, country of birth, earnings, consumer expenditures, time use, workplace injuries, and employment projections.
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Read more »