Latvia
Official title
Consumer Price Index.
Scope
The index is computed monthly and refers to all households in the
country.
Official base
For computation: previous year = 100.
For publication: 1995 = 100.
Sources of weights
New weights are introduced in January each year. Actual weights
are derived from the previous year household budget survey, which
covered a period of 12 months: IX-XII of 1996 and I-VIII 1997.
Difference of one quarter from the price base (1997=100) is
estimated as insignificant. The survey is representative for all
private households in Latvia and covers approximately 8,000
(i.e. average 666 per month) randomly selected households who
stay in the sample for one month. The weights for only 60% of
the goods and services included in the price index can be obtained
from the HBS. Different additional sources (macroeconomic data
and market research analysis) have been used to compare the HBS
information. The weights construction for some specific
categories needs additional special statistical surveys. Alcohol
and tobacco weights are adjusted using National Accounts data.
Weights and composition
| Major groups
| Number of items
| Weights in 1998
| No. of price quotations
|
| Food and non-alcoholic beverages
| 101 | 41.0 | ...
|
| Alcoholic beverages and tobacco
| 10 | 5.6 | ...
|
| Clothing and footwear
| 76 | 6.1 | ...
|
| Housing
| 28 | 17.3 | ...
|
| Household goods
| 51 | 2.6 | ...
|
| Health care
| 21 | 4.4 | ...
|
| Transport
| 19 | 7.3 | ...
|
| Communications
| 5 | 2.1 | ...
|
| Recreation and culture
| 37 | 4.8 | ...
|
| Education
| 3 | 1.0 | ...
|
| Hotels and public catering
| 11 | 4.0 | ...
|
| Miscellaneous goods and services
| 35 | 3.8 | ...
|
| Total
| 397 | 100.0 | 14,400
|
All goods and services are classified according to the COICOP
classification.
Household consumption expenditure
For the derivation of weights the actual expenditure approach is
used. For credit purchases of durable goods only the payments actually made
during the reference period are included. Income in kind and second-hand
purchases (on the true net bases) are taken into account.
Licence fees, insurance associated with specific consumer goods,
health care, life insurance payments, remittances, gifts and
other similar disbursements are included.
Home ownership is treated as investment and is not taken into
account. Contributions to social insurance and pension fund
are treated like direct taxes and are excluded.
Sample selection
Purposive sampling of representative goods/services is used for
item and outlet selection. Items are chosen to represent other
goods and services not covered. The localities with high supply
and demand which are representative for the regions and zones
within the regions are selected. Small outlets are covered as
well.
Method of data collection
Each month, more than 14,400 prices and tariffs for 397 basic
goods and services are collected from about 1,530 outlets in 15
(out of 26) regions. Prices are recorded from the 10th through
the 20th day of a reference month. When tariffs of centrally
determined items are changed in the middle of the month, average
price for the month is calculated. The prices of the items for
which customers pay annually (e.g. tax for the land on which private
house stands) are carried forward. Price reductions are taken
into account if quality of such goods satisfy regular price
registration rules, goods are available in significant
quantities and price reduction take place in the selected
outlets. Black market prices, hire-purchase and credit terms prices
are not included. From second hand purchases, only second-hand cars
are included as separate item. Prices of imported goods and
open market prices are collected and average prices are
calculated as from other regular prices.
Housing
Total weight for housing is 17.6%. At present there is only one
item in the housing index - annual rent for municipal flat,
for 10m2. Data are collected monthly. Owner-occupied housing is
not included. However, operating expenditures of co-operative
flat owners are included in the subgroup Service for regular
maintenance
.
Specification of varieties
As the market is not yet stabilised, it is difficult to use tight
specifications for all priced goods. Tight specifications are
used for services, food products and cars. For all other items,
the specifications are widely defined and it is up to the
price collectors to decide what particular varieties
(brand, type) would be priced. They are asked to provide precise
characteristic of the varieties priced each month.
Substitution, quality changes
About 2% of the monthly observed prices are quality adjusted.
If a given type or quality disappears from the market, a close substitute
is priced and linked. If there is a big quality difference, the substitute
is treated as a new item and new base period price is imputed.
Seasonal items
For winter and summer clothes and footwear which are not
available for observation during the off-season the latest
available price is carried forward until the item becomes
available again. During the harvest season (August-October)
prices of the 9 seasonal fruit and vegetable items are collected
weekly.
Seasonal adjustment is used only for potatoes. For potatoes 2
separate prices are collected: for new harvest and old harvest.
From May till September the new potatoes price is available.
During October-May the last observed price is carried forward.
Prices for old harvest potatoes are observed from October till
June including. For other vegetable and fruits items special
seasonal adjustment is not used since all fruits and vegetable
items are available all the year.
Computation
The monthly CPI was introduced in January 1991 using the Paasche
formula and was replaced in June 1992 by an index compiled using
the Laspeyres formula. The national index covers 15 out of
Latvia's 26 regions. The formula used for the computing
elementary aggregate indices is the ratio of arithmetic mean prices
Population weights are used so that the 15 regional indices are
combined in national index.
Other information
None.
Organisation and publication
Central Statistical Bureau of Latvia
Monthly bulletin Consumer Price Indices
,
Monthly Bulletin of Latvian Statistics
,
Statistical Yearbook of Latvia
,
Monthly Press Release
On Internet website: http://www.csb.lv