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I wonder how the increase(s) in consumption/capital spent (additional fuel, machinery, pollution, trucks, ships, etc...) would impact the Earth's environment if sizes didn't shrink?
Quote:
Originally Posted by jamiecta
everything is shrinking but the average waist-size
LOL--good observation. Looks like supply & demand population growth is working as it's suppose to? I wonder why HOUSES/cars/healthcare are having such a difficult time permanently shrinking in size?
Have you noticed how everything in the grocery store is getting smaller?
So my question: we all know the gov't uses 'substitutions' when
figuring the CPI. Does it account for shrinking quantities?
Or is a bar of soap a bar of soap to them.
Yes the CPI does take into consideration the shrinking quantities. This issue comes up so often that it is specifically addressed in the Bureau of Labor Statistics Frequently Asked Questions:
How are CPI prices collected and reviewed?
Each month, BLS data collectors called economic assistants visit or call thousands of retail stores, service establishments, rental units, and doctors' offices, all over the United States, to obtain information on the prices of the thousands of items used to track and measure price changes in the CPI. These economic assistants record the prices of about 80,000 items each month, representing a scientifically selected sample of the prices paid by consumers for goods and services purchased.
During each call or visit, the economic assistant collects price data on a specific good or service that was precisely defined during an earlier visit. If the selected item is available, the economic assistant records its price. If the selected item is no longer available, or if there have been changes in the quality or quantity (for example, eggs sold in packages of ten when they previously were sold by the dozen) of the good or service since the last time prices were collected, the economic assistant selects a new item or records the quality change in the current item.
The recorded information is sent to the national office of BLS, where commodity specialists who have detailed knowledge about the particular goods or services priced review the data. These specialists check the data for accuracy and consistency andmake any necessary corrections or adjustments, which can range from an adjustment for a change in the size or quantity of a packaged item to more complex adjustments based upon statistical analysis of the value of an item's features or quality. Thus, commodity specialists strive to prevent changes in the quality of items from affecting the CPI's measurement of price change.
Yes the CPI does take into consideration the shrinking quantities. This issue comes up so often that it is specifically addressed in the Bureau of Labor Statistics Frequently Asked Questions:
How are CPI prices collected and reviewed?
Each month, BLS data collectors called economic assistants visit or call thousands of retail stores, service establishments, rental units, and doctors' offices, all over the United States, to obtain information on the prices of the thousands of items used to track and measure price changes in the CPI. These economic assistants record the prices of about 80,000 items each month, representing a scientifically selected sample of the prices paid by consumers for goods and services purchased.
During each call or visit, the economic assistant collects price data on a specific good or service that was precisely defined during an earlier visit. If the selected item is available, the economic assistant records its price. If the selected item is no longer available, or if there have been changes in the quality or quantity (for example, eggs sold in packages of ten when they previously were sold by the dozen) of the good or service since the last time prices were collected, the economic assistant selects a new item or records the quality change in the current item.
The recorded information is sent to the national office of BLS, where commodity specialists who have detailed knowledge about the particular goods or services priced review the data. These specialists check the data for accuracy and consistency andmake any necessary corrections or adjustments, which can range from an adjustment for a change in the size or quantity of a packaged item to more complex adjustments based upon statistical analysis of the value of an item's features or quality. Thus, commodity specialists strive to prevent changes in the quality of items from affecting the CPI's measurement of price change.
It also messes up recipes that call for ingredients like a can of soup. And no one can compare the food component of the CPI to their grocery bill and think these analysts are adjusting for the thousands of changes in packaging sizes.
It also messes up recipes that call for ingredients like a can of soup.
.
How true! One of my older recipes calls for 1/2 can of Campbell's tomato soup--when it was 16 oz!
Now the can has 10 1/2 oz I believe.
But the shrinking has been going on quietly for years. I used to love Andes mint chocolates; they came wrapped in plastic with just some thin cardboard on the bottom to hold the shape. Over the years, they have constantly increased the amount of cardboard that now surrounds the pieces so that you get less than half the amount--of course for a lot more $$ than the full size; but the package "looks" the same.
Paper towels used to come in rolls of 100 sheets. I believe now you get 60 something at most and chances are the sheets are smaller as well, just like with toilet paper. If you have an old roll of TP, you can see the difference in size - shorter and more narrow. The only way to compare those items is the square footage of paper and who does that?
And the list goes on
BTW, over the years I have noticed that when a particular item goes on sale for an extended period of time and at all major stores, chances are changes in packaging are coming--and with it most likely a "smaller" product - so I stock up = savings, tax free
The government uses CPI. CPI does not adjust for shrinking serving sizes unless they are obvious. Difference in number of eggs -- yes they account for that. Oranges sold by the "each" with a change in volume of 3%, they do not see that. You used to go to a store where someone carried the bags out to the car for you, and now you shop at target with less customer service? No, they do not see that difference in the experience, they just record the target price instead of the prices at the other store that went out of business.
--Source: My MBA.
Unfortunately, there is a great deal of misinformation about this. We have covered to some degree the gaming that goes on in regards to twisting the CPI. Changes in quality are specifically NOT addressed, and this has been brought up several times by economists suggesting that the CPI has become an inaccurate measure. - Yes, I saw the link. Inaccurate information appearing on the internet? Yes, it does happen.
This has resulted in an understating of inflation which allows payments based on "inflation" to remain lower than they otherwise would have been. The largest increases in prices are also in the cheapest items, and as a result the inflation felt by those who are responsibly living on a small budget is higher than the inflation felt by others.
Unfortunately, since many people don't pay enough attention, this has been going on for a long time. It's very unfortunate, because sellers are reducing the only thing consumers really give a **** about. In particular, we see this in fast food. They have reduced sizes (and occasionally jacked up prices) on the items that used to provide a good value. If you go buy burger king, you may get a whopper with less than one half of a leaf of lettuce. Wendy's has done a dramatic shrinking of their "value" burgers. I hadn't been there in several years and decided to stop in about 18 months ago. I found they had done a 30 to 40% reduction on the burger size and raised the price. Thanks guys, prices have gone up, but that was insulting. Done with that franchise. In food, the actual cost of the food is usually about 30% of the sale price. When they jack part of the food, it is like spitting in the consumers face. The consumer doesn't care about the other part of the process, they just want the food. It's 30% of the sale price, but it is most of the value to the consumer. IE. 30 cents of ingredients to go into a dollar hamburger. They decide to reduce the size by one third to improve profits. They now sell you 20 cents of ingredients and charge a dollar. They saved ten cents, but you're out the value of 33 cents.
It sucks, but is going to continue happening. I've just found more and more places that I refuse to spend my money.
PS. No disrespect is meant towards the person who was kind enough to post the CPI link. I simply know from years of study that the information provided by the CPI is not as accurate as they claim.
Last edited by geographystudies; 07-29-2013 at 09:27 AM..
This is how the 100% increase in food prices have been masked over the past decade to fool the average person and keep it out of the statistics.
LOL! The average person doesn't do the statistics. The people who actually do the statistics are well above average folks who are intimately aware of changes in product packaging and who routinely adjust for them in preparing the CPI-U and other related measures.
PS. No disrespect is meant towards the person who was kind enough to post the CPI link. I simply know from years of study that the information provided by the CPI is not as accurate as they claim.
Years of study should have been more than enough time for a competent reviewer to realize that BLS does not claim any level of accuracy at all. They explain what they do. One part of which is adjusting for the obvious (such as changes in product size or volume), and another of which is adjusting for what may be the less obvious (such as changes in product quality). Since the CPI index family as published presents the best data on the subject available anywhere on the planet, there is no higher standard to compare them to. Your post thus engages worthlessly in unsupportable histrionics and sophistry.
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= savings, tax free 
