3.3.1 Source data statistical techniques
- Treatment of missing prices: Missing items and their replacements are treated according to Commission Regulation (EC) no 1749/96.
If a price observation is missing, then the missing price is allowed to be estimated for the next two months. After a two month estimation period the product is replaced with the most comparable one in the same outlet. In case of a replacement, the price of the new product for the previous month is included if known or it is estimated by methods such as “Bridged Overlap”. According to this method the price estimation is based on the price dynamics of similar products within the same product group.
Procedures are applied on a case by case basis.
- Selection of replacement items: the product is replaced with the most comparable one in the same outlet, based on the experience of the price collector and where necessary, in collaboration with the outlets or the service providers.
- Adjustments for quality differences: Quality adjustments are made according to Commission Regulation (EC) no 1749/96. The methods implemented are chosen according to a case by case approach. At the present time no hedonic methods are used.
Price adjustments due to quality changes are most frequent for cars, electronics (computers, televisions...) , clothing and other technical products.
- Introducing new products: New goods and services detected in the outlets by price collectors or reported to be significant in other Member States are included in the relevant elementary aggregate in December of the year during which their presence on the market has shown their significance.
- Seasonal items: Progressive introduction of methods as defined in the Commission Regulation (EC) No 330/2009. Concerning “fruits” and “vegetables” the share of these two groups in the weighting system of the reference period is fixed, while the internal composition of both groups varies within the seasonal months. As regards clothing a “carry forward” method is in use, this will be adapted during 2010 to comply with regulation (EC) No 330/2009.
- Verification of processing: A special index committee (“Commission de l’indice des prix à la consommation”) is set up, comprising the principal social partners and experts in index numbers. All the methodological aspects are discussed in this committee. Every month it examines retail prices recorded and indices. The monthly results are only published after its approval.
The annually fixed weights scheme is, additionally to the special index committee also discussed in the “Conseil Economique et Social”, another Committee composed of experts and social partners, before it is approved by the Government and becomes a regulation.
- Seasonally-adjusted indices: none
3.3.2 Other statistical procedures
- Computation of lowest level indices: All individual prices collected are transformed to indices with base 100 = December of previous year. The indices of the elementary aggregates (basic groupings) are obtained by calculating for every aggregate the geometric mean of the indices of that elementary aggregate. The unweighted geometric mean is used for all elementary aggregates.
- Aggregation: The aggregation formula used is of Laspeyres type. Indices of basic groupings are aggregated according to the subdivisions of the revised COICOP classification. The Luxembourg consumer price index is, since 1999, an annually chained Laspeyres-type index.
- Alignment of expenditure and base period: The weights reference period for the year Y is the year Y-3, these weights are updated by the December Y-1 prices. For instance, weights for 2009 are based on the National Accounts of the year 2006 updated with the December 2008 prices.
- Linking reweighted index to historical index: The process for linking of the re-based index after a weight update to the old series is achieved through the chain index. In a chain index each link consists of an index in which each period is compared with the preceding one, the weight and price periods being moved forward each period.
- Reference period: The index reference period was 1996=100 for all indices and sub-indices until December 2005. From January 2006 on, the index reference period is set as 2005=100. From the 1st January 2006, according to European regulation, the base year is set as 2005 (2005=100).
3.4.1 Validation of intermediate results
- Verification of prices: All price notations of the month are individually controlled at different stages of the survey, and checked in case of doubts. Price collector’s work is supervised and some random checks of prices are done.
In a first control phase all prices entered into the computer database are reviewed by another price collector, different from the one who first entered the data into the computer system. In a second phase a special software ensures automatic control of the data. If the difference between the T and T-1 prices exceeds an indicated threshold the software requires an additional check of the data. The database also includes different types of queries allowing to detect possible errors (for instance a query producing a table showing the maximum and minimum price change of the products over a period). All replacements are also individually checked, commented and explained.
If there are still doubts about the reliability of one or more prices, these prices are checked once again by contacting price collectors or if necessary, checked directly in the outlets. 3.4.2 Assessment of intermediate data
- Verification of processing: A special index committee (“Commission de l’indice des prix à la consommation”) is set up, comprising the principal social partners and experts in index numbers. All the methodological aspects are discussed in this committee. Every month it examines retail prices recorded and indices. The monthly results are only published after its approval.
The annually fixed weights scheme is, additionally to the special index committee also discussed in the “Conseil Economique et Social”, another Committee composed of experts and social partners, before it is approved by the Government and becomes a law after it has been adopted by the Parliament. |
Dissemination
