Measuring inflation during the pandemic with the benefit of hindsight

Chowdhury, Aftab Uddin and Dixon, Huw ORCID: https://orcid.org/0000-0002-9875-8965 2023. Measuring inflation during the pandemic with the benefit of hindsight. [Working Paper]. Cardiff Economics Working Papers, Cardiff: Cardiff Business School. Available at: http://carbsecon.com/wp/E2023_17.pdf

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Abstract

This study has adopted the actual household expenditure data from the national accounts to construct a true inflation rate (using the Fisher index) and found that the official inflation rate in the 33 OECD countries was an overestimate of true inflation for 22 and underestimate in 11 countries in the first wave of the COVID-19 pandemic. The result obtained for the countries where true inflation was higher than the official rate in this study matches the results obtained by Cavallo (2020) and Reinsdorf (2020). However, a significant difference has been detected for the countries where the official inflation exceeds the true measure in this study. The core reason behind the discrepancies is in the use of appropriate expenditure weights. This suggests caution in using credit-card based expenditure data when spending behaviour has changed dramaticall

Item Type:	Monograph (Working Paper)
Date Type:	Publication
Status:	Published
Schools:	Business (Including Economics)
Publisher:	Cardiff Business School
Date of First Compliant Deposit:	10 October 2023
Last Modified:	10 Oct 2023 09:07
URI:	https://orca.cardiff.ac.uk/id/eprint/162824

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