Jeff Neal for C.U.R.E. - Certain Unalienable Rights Endowment

CPI – Does it measure anything?

In Economics, Everyday Life, Recommended Reading on February 6, 2011 at 7:39 am

Professor Donald Boudreaux asks (at some length) whether the CPI conveys any useful information.  He looks at the 1975 Sears & Roebuck catalog and analyzes the price of many of its items.  Link to Cafe Hayek — where orders emerge.

It’s an interesting read about the things CPI attempts to measure.  I ask an additional question to which he alludes but doesn’t ask explicitly – How can we compare with a statistic the price of something we take for granted today (the computer screen you’re reading at the moment, e.g.) which didn’t exist at any price in 1975?

Not everything can be measured in terms of money.  The value of the truth and the freedom to innovate is incalculable.

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