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Note On the Retail and Consumer Price Indices

Published online by Cambridge University Press:  26 March 2020

J. R. Shepherd
J. R. Shepherd*
Affiliation:
National Institute of Economic and Social Research
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Extract

The Ministry of Labour has recently introduced a new index of retail prices using a method rather different to that of earlier indices. This is the index that is usually used in wage and salary negotiations. This note gives a brief explanation of the change.

Type
Articles
Information
National Institute Economic Review , Volume 20 , May 1962 , pp. 52 - 55
Copyright
Copyright © 1962 National Institute of Economic and Social Research

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References

Note (1) page 52 A full account of the 1956 Retail Price Index and of the revisions introduced in 1962 may be obtained from the following Government publications : Ministry of Labour and National Service, Method of Construction and Calculation of the Index of Retail Prices, HMSO 1956. Cost of Living Advisory Committee, Report on Revision of the Index of Retail Prices, Cmnd. 1657, March 1962; Ministry of Labour Gazette, March 1962.

(2) Until 1947 the official index was known as the Cost-of- Living Index and was based mainly on the expenditure pattern before 1914. The Interim Index was introduced in 1947 and the weights were revised in 1952 to take account of post-war expenditure data. For details see, for example, Ministry of Labour and National Service : The Cost of Living Index Number: Methods of Compilation, HMSO 1944; and, Interim Index of Retail Prices : Method of Construction and Calculation, HMSO, 1950.

Note (1) page 53 These estimates are described in National Income Statistics, Sources and Methods, H MSO 1956.

Note (1) page 54 Ministry of Labour. Family Expenditure Survey, Report for 1957-59; HMSO 1961; Ministry of Labour Gazette, December 1961.

(2) The retail series for electricity prices is not published. The difference in technique is not simply that between base- weighted and currently-weighted indices. A currently- weighted index could equally well measure the cost of con suming at a fixed level, but the levels chosen would then be typical of current-period consumption.