> If people spend on item X less or no more, why would it be included in the index at the old weight?
Say ten years ago, hypothetically, everyone ate steak and wine every day for $100/week and today everyone can only afford to survive on ramen and tap water and it costs $100/week.
If you change the basket to say people today only want ramen, you will conclude that there has been 0% inflation in a decade. Everyone still spends $100/week on food, no change at all!
Say ten years ago, hypothetically, everyone ate steak and wine every day for $100/week and today everyone can only afford to survive on ramen and tap water and it costs $100/week.
If you change the basket to say people today only want ramen, you will conclude that there has been 0% inflation in a decade. Everyone still spends $100/week on food, no change at all!
That does not seem like a useful measurement.