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by tomrod
1517 days ago
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To my understanding, CPI does not weight amounts purchased, only general prices. I'm happy to be corrected if that's mistaken. Without the amounts, it's a linear combination of "we're being shafted" and "we can substitute those things left out of the CPI with some ease relative to other types of good." Income + substitution effects and such. Your personal inflation is probably not 15% if you're not buying the exact same bundle of goods you purchased last year. Higher, yes, but if you substitute away or choose other options you're probably not expending exactly 15% more than last year. |
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