The Study On Hedonic Price Index

The Price index is an important economic statistics of the country. The Accuracy of price index is very important for the economic decision-making, but there are many kinds of bias ,for example, commodity substitution bias, outlet substitution bias, quality change bias and new goods bias. With the development of technology, quality change bias becomes a big part in the bias. How to make the quality change bias smaller become a problem to the economist and statistialist. Now American, England, Newzealand, Japan and some European countries begin studying the quality change bias and make many methods to solve this problem. There are many traditional quality change methods: Match Model Method Only, Overlapping Link Method, direct comparison method, Imputed price change .However, there are many kinds for these methods. Then economists begin studying regression method to solve this problem and get a good answer. This regression method also name Hedonic price index.Hedonic method is a quantity method ,and makes the bias smaller .Hedonic method can compute the price index alone ,and find the substitution for Match Model Method. Of course ,Hedonic method is not perfect ,it needs high quality number.In the foreign countries, Hedonic method is used to compute the price index of computer ,house, car ,electronic goods and so on. In the country ,the study of quality bias is blank and we should build our countries'quality adjust price index. So this chapter introduces quality adjust methods, and mainly introduces Hedonic method, and studying the problems created by using the Hedonic method. Finally ,taking computer price index as an example, studying the Hedonic method used in our country.