Econ 201 Inflation

Link to slides

Class notes on Computing and Using the Consumer Price Index (CPI)

Class notes on using the Consumer Price Index

For interest:

• The Consumer Price Index (CPI) over time (mostly upward...and that's a good thing!)

• The rate of inflation, as measured by the CPI (The % change in the CPI, which is the inflation rate. It's rarely below zero (deflation) since the 1930s)

• Why is deflation so harmful?  Mark Thoma, April 4, 2014

• Here are the components of the CPI in a cool graphic.  Food and beverages 15%, gasoline 5.2% of the total.  (New York Times, 2008)

  • How does the average family spend its paycheck?  

• The Billion Price Project - Here is a description!  (James Surowiecki, The New Yorker, May 30, 2011)

• What's so bad about deflation?  (Slate, July 3, 2010)

• In Praise of Inflation (James Surowiecki, The New Yorker, September 29, 2010)

• The price of gold and inflation...people get this wrong.  (David Leonhardt, New York Times, November 9, 2010)

• Historic Food Prices  (www.foodtimeline.org)

• Historic Prices in Morris County, New Jersey

For amusement

• Dilbert

• The dangers of failing to keep track of the price level ("Throw me a frickin' bone here!")

• Here's what happens when journalists aren't careful about adjusting for inflation:  They have to issue a retraction!  

  • Headline: College May Become Unaffordable for Most in U.S.  (New York Times, Dec. 3, 2008)

  • Posted correction: "Because of an editing error, an article on Wednesday about the increasing cost of higher education gave an incorrect context for two figures: the 439 percent increase in college tuition and fees and the 147 percent increase in median family income since 1982. Those figures were not adjusted for inflation. The error was repeated for the data in an accompanying chart. A corrected chart appears at nytimes.com/national."

• Inflation and Movie Box-Office Records.  And why don't journalists get it right when they report box office records?