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Fashion and CPI. 10th meeting of the Ottawa group. Summary. Why clothing is a problem for CPI compilation What is quality in clothing Dynamic vision of quality What can we do for quality adjustment. Discrepancy in clothing CPI. Discrepancy in clothing CPI. Discrepancy in clothing CPI.
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Fashion and CPI 10th meeting of the Ottawa group
Summary • Why clothing is a problem for CPI compilation • What is quality in clothing • Dynamic vision of quality • What can we do for quality adjustment
When do the prices change ?distribution of price changes in CPI according to the situation of the product
What is quality ? • “the evaluation of the quality change is essentially an estimate of the additional amount that a consumer is willing to pay for the new characteristics possessed by the new quality” (CPI manual, chapter 1, 2004) • Dynamic hedonic approach : model for price with • Brand • Type of outlet • Technical features: type of fabric… • Appearance (fashion): cut, color, accessories…
Practical solution • Two kinds of characteristics : • Constant over time quality adjustment • Changing over time (fashion) no quality adjustment • Result : about + 0,6 % to year to year evolution.