What is included in the Consumer Price Index market basket?
The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) is limited to the spending patterns of younger working consumers and represents less than one-third of the total U.S population. Although used to determine Cost-of-Living Adjustments (COLAs), it specifically EXCLUDES the spending experience of anyone whose primary source of income is from retirement pensions. Currently the CPI-W market basket contains such things as rent, some medical costs, food, gas and oil among other items. It also includes high tech consumer items such as computers, big screen televisions, cell phones, DVD players that tend to rapidly decrease in price as the technology improves. Seniors however, do not purchase high tech items as often as younger working consumers. Instead, older Americans spend a greater share of their incomes on items that are more rapidly increasing in price-like prescription drugs and health care. Thus senior advocates say the CPI-W tends to understate senior costs r
