This conference, organised jointly by the Centre for Micro Methods and Practice and the Economic and Statistics Working Group on Zoom on 28/29th April 2021, examines the problems involved in producing measures of price change, quantity change and changes in welfare. It explores some of the issues arising from the availability of new sources of data such as those from scanners as well as traditional problems lie measuring the price of housing. Kevin Fox (University of New South Wales) will give a keynote lecture on “Price Index Measurement during Pandemics: What have we learnt from Covid-19?”.
For more details and to register for the conference please go to https://www.cemmap.ac.uk/event/measuring-prices-and-welfare/
This conference explores the problems involved in producing measures of price change and quantity change. Historically the focus has been on measuring price changes using prices indices and using these to derive quantity changes. Price indices themselves are constructed from price data collected mainly from shops by combining them using weights derived from household or business surveys.
An important purpose behind the production of price indices is to make it possible to examine how welfare changes over time. This raises problems of its own. A particular issue can arise over the provision of publicly-provided goods which, even if not provided free, may not be sold at free-market prices. As a result, prices may not fully capture the value of these goods.
The increasing use of scanners in shops and the rising importance of web transactions offer new sources of data. In particular, scanner data make available timely quantity and price data, and raise the possibility of constructing price indices which reflect quantity responses in real time. At the same time, these new data sources raise new questions. How to construct real time price indices? How to cope with extremely large volumes of irregularly sampled data? How to address missing data problems in scanner data?
In addition, in both traditional and new sources of data, substantial issues remain in identifying quality changes, and thus producing satisfactory decompositions of value changes into price, quality, and quantity changes. The issue is perhaps particularly acute with measuring housing prices where a significant component of price variation is driven by size, quality and location. A number of additional important conceptual issues arise here such as how to measure the service flow form the stock of housing and how to properly account for risk and uncertainty.
A keynote lecture will be given by Kevin Fox on:
“Price Index Measurement during Pandemics: What have we learnt from Covid-19?”
This talk will cover both the theory and practice of price index construction under pandemic conditions. It will reference national statistical institute responses and suggest lessons that may inform future price index construction, such as the benefits of revisable price indexes, digital data collection and continuous household expenditure surveys.
The provisional programme for the conference is now available, please click here for the programme.
Kevin Fox is a Professor and Director of Centre for Applied Economic Research at the UNSW Business School. He works primarily in the field of economic measurement, with a focus on productivity and prices. Recent research includes contributions on using scanner data in price indexes, CPI construction under pandemic conditions, and the measurement of real consumption of free digital goods and services. He is President of the International Association for Research in Income and Wealth, a member of the Steering Committee of the International Working Group on Price Indices (“Ottawa Group”), and a member of the Australian Bureau of Statistics Methodology Advisory Committee. He chaired the Australian 16th Series CPI Review Advisory Group in 2009-2010. After studying Japanese in Tokyo for two years, he studied economics at the University of Canterbury and the University of British Columbia. He served as Head of the UNSW School of Economics for five years, 2008-2012. He is a Fellow of the Academy of the Social Sciences in Australia, Fellow of the Society for Economic Measurement, and a Member of the NBER-affiliated U.S. Conference on Research in Income and Wealth.
CeMMAP, the Centre for Microdata Methods and Practice, is a research centre supported by the Economic and Social Research Council. CeMMAP develops and applies methods for modelling individual behaviour, the influences on it and the impact of policy interventions.
The Economic and Statistics Working Group was set up and is supported by the Economic Statistics Centre of Excellence, the Office for National Statistics, the Royal Economic Society, the Royal Statistical Society and the Society of Professional Economists to promote research and understanding of issues associated with economic statistics.
Day 1: 28th April 2021
11:00 – 12:00: Kevin Fox (8 p.m. Sydney time)
1:30 – 2:15: ONS “Shortlisting Appropriate Index Number Methods for use on Web Scraped and Scanner Data”
H. Sands or A. Rose
2:15 – 3:00: “High Dimensional High Frequency Retail Price Dynamics: Accounting for Missing Prices and Quantities.”
A. Crawford and L. Nesheim
QUALITY ISSUES AND PRICE INDICES
3:15 – 4:00: “Quality-adjusted Price Indices Powered by ML and AI”
4:00 – 4:45: “Muth’s Model of the Housing Market”
J. Rouwendal and M. van Duijn.
Day 2: 29th April 2021
WELFARE AND WELL-BEING
1:30 – 2:15: “In Search of a Complete and Unambiguous Ordering of a Collection of Welllbeing States”
G. Anderson and T.W. Leo
2:15 – 3:00: “Incorporating Social Welfare in Program Evaluation and Treatment”
D. Bhattachary and T. Komarova
: Key Challenges in Measuring Prices
- Centre for microdate methods and practice