Experimental PPI Index Aggregation Systems with Services and Construction Price Indexes

• Activity Number: 300
• Type: Contributed
• Date/Time: Tuesday, August 3, 2010 : 8:30 AM to 10:20 AM
• Sponsor: Business and Economic Statistics Section
• Author(s): Jonathan Weinhagen*+
• Companies: Bureau of Labor Statistics
• Keywords: stage of processing system ; producer price indexes

Abstract

The Producer Price Index (PPI) program currently emphasizes the stage of processing (SOP) system as its key structure for analyzing producer prices. The SOP system aggregates manufacturers' selling prices for crude, intermediate, and finished goods. Over the past 20 years, however, PPI coverage has expanded to include price indexes for many service and construction activities. The PPI has developed two experimental index aggregation systems that incorporate these indexes and is seeking data user feedback. The first system organizes indexes based on type of commodity (goods, services, or construction) and whether the commodity is sold to intermediate or final demand. The second system organizes commodities into multiple stages of production ending in final demand. This paper compares the two aggregation systems and examines the pros and cons of the systems.