Owner-Occupied Housing, the Cpi, and Indexing

The Consumer Price Index is widely used as a basis for adjusting money incomes in both the private and the public sector. Problems in measuring the cost of owner-occupied housing have contributed to serious deficiences in the accuracy of the CPI's measurement of price level change. A shift to imputed rental value has improved the measure but still ignores a serious conceptual issue. The problem is examined in this article.