Substitution Bias in Multilateral Methods for CPI Construction using Scanner Data

@inproceedings{Diewert2017SubstitutionBI,
  title={Substitution Bias in Multilateral Methods for CPI Construction using Scanner Data},
  author={Walter Erwin Diewert and Kevin J. Fox},
  year={2017}
}
The use of multilateral comparison methods in a time series context is increasingly becoming an accepted approach for incorporating scanner data in a Consumer Price Index. The attractiveness stems from the ability to be able to control for chain drift bias. Consensus on two key issues has yet to be achieved: (i) the best multilateral method to use, and (ii) the best way of extending the resulting series when new observations become available. This paper presents theoretical and simulation… CONTINUE READING