The challenges to economic measurement arising from inflation in the post-pandemic world

Dixon, Huw ORCID: https://orcid.org/0000-0002-9875-8965 2025. The challenges to economic measurement arising from inflation in the post-pandemic world. National Institute Economic Review 10.1017/nie.2024.26

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Abstract

The pandemic caused expenditure shares to vary more than usual, leading to serious ramifications when combined with the fact that the expenditure shares used to calculate CPI inflation are 1-2 years old. This caused a potential bias in the measurement of inflation. We also look at the cost-of-living crisis and found that the lags in updating the expenditure shares for energy and food led to an underestimate of inflation in 2022. Inflation also has a large effect on the measurement of the public sector deficit. With a high debt-GDP ratio and high inflation, there was a substantial inflation tax.

Item Type:	Article
Date Type:	Published Online
Status:	In Press
Schools:	Schools > Business (Including Economics)
Publisher:	Cambridge University Press
ISSN:	0027-9501
Date of First Compliant Deposit:	30 January 2025
Date of Acceptance:	30 January 2025
Last Modified:	20 Mar 2025 10:40
URI:	https://orca.cardiff.ac.uk/id/eprint/175759

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