New methodology for selecting CPI outlet samples

Monthly Labor Review

Volumn 119, Issue 12, 1996, Pages 49-57

  Cage, Robert ^a  

^a BUREAU OF LABOR STATISTICS   (United States)

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EID: 0041700986     PISSN: 00981818     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (18)

1. See Walter Lane, "Changing the item structure of the Consumer Price Index," this issue, pp. 18-25.
2. For a complete list of market basket items selected as part of the 1964 CPI revision, see BIS Handbook of Methods (Bureau of Labor Statistics, 1964-77).
3. See W. John Layng, Revising the CPI: A Brief Review of Methods, Report 484 (Bureau of Labor Statistics, 1976), p. 2.
4. Ibid.
5. POPS categories represent the entry-level items that make up the CPI market basket. Some POPS categories consist of only one entry-level item, while others consist of multiple items. Generally speaking, entry-level items are combined into a single POPS category when the set of unique products that are included in the entry-level items is sold in the same outlets.
6. An item stratum is a group of items sold for consumption for which the Bureau calculates an average price change to be used in the Consumer Price Index for All Urban Consumers (CPI-U). With rare exceptions, the item stratum is the lowest level of product aggregation for which collected prices are pooled together to measure an average change in price.
7. An entry-level item is a group of specific goods and/or services sold for consumption that establish the definition used by field staff in the identification of unique items within an outlet that can be selected for pricing.
8. For more information on the selection of item samples, see BLS Handbook of Methods, Chapter 19, "The Consumer Price Index," pp. 176-235.
9. For more information regarding disaggregation, see BLS Handbook of Methods, Volume II: The Consumer Price Index, Bulletin 2134 (Bureau of Labor Statistics, 1984).
10. For example, 1985-86 Consumer Expenditure Survey data were used for the selection of entry-level items in sampling units administered the CPOPS survey in 1988.
11. The samples of housing units selected to represent rent and owners' equivalent rent are derived from a separate process. For more information on housing samples, see Frank Ptacek, "Revision of the CPI housing sample and estimators," this issue, pp. 31-39.
12. For a complete list of the relative importance of CPI market basket items, see Relative Importance of Components in the Consumer Price Index, 1995, Bulletin 2476 (Bureau of Labor Statistics, February 1996).
13. Most non-POPS categories represent items that are sold in monopolistic markets (for example, electricity and intercity bus service) and therefore do not require a survey of consumers to determine a representative list of outlets patronized in each sampling unit.
14. For the purpose of selecting outlets, sampling units are divided into one or more "half-samples." The majority of large, or A-size, sampling units are composed of two half-samples, while all smaller units receive one half-sample. Outlets are selected by POPS category for each half-sample. Thus, sampling units with more than one half-sample receive a larger sample of outlets than those with only one half-sample. Half-samples also provide a mechanism for the Bureau of Labor Statistics to calculate variances for price-relative estimates. For more information on variance estimation, see Sylvia G. Leaver and David C. Swanson "Estimating Variances for the U.S. Consumer Price Index for 1987-1991," Proceedings of the Survey Research Methods Section, American Statistical Association, 1992, pp. 740-45.
15. A consumer unit is the technical reference unit of the CPOPS survey. It is defined as (1) all members of a particular household who are related by blood, marriage adoption, or some other legal arrangement; (2) a person living alone; or (3) two or more persons living together who pool their incomes to make joint expenditure decisions.
16. The designated number of completed interviews per sampling unit half-sample is set at 140 for large areas and 160 for small areas (urban, nonmetropolitan areas).
17. The implicit quantity weight for an item priced in the CPI is equal to (α Efg)/(MB), where a is the percent of sales of the corresponding entry-level item to the total sales of the corresponding POPS category in the selected outlet; E is the total daily expenditure for the POPS category in the corresponding index area replicate, derived from CPOPS; f is a factor that reflects any special subsampling of outlets or items; g is a geographic factor representing differences in index coverage in geographic areas over revision periods; M is the number of usable quotes for the entry-level item/sampling unit half-sample for the corresponding item stratum; and B is the proportion of expenditures for the corresponding entry-level item of the total expenditures for the corresponding item strata, as derived from the Consumer Expenditure Survey. For more information on item weights, see BLS Handbook of Methods, Chapter 19, "The Consumer Price Index," pp. 190-91.
18. See Clyde Tucker, Robert Cassady, and James Lepkowski, "An evaluation of the 1988 Current Point of Purchase CATI feasibility test." Paper presented at annual meeting of the American Statistical Association, Atlanta, GA, Aug. 19-22, 1991.