Mismeasurement of inflation is likely to be more severe in a transition economy than in a more stable environment. Comparisons of self-reported changes in economic welfare with changes in incomes suggest that official Romanian inflation measures may be overstated by between 100 and 300 percent...

The rapidly changing environment of the transition may create special problems for calculation of index numbers that require a fixed basket of goods and outlets. Using referent-level data we find that using a fixed-weight Laspeyres Index may overstate inflation rates by approximately 5 percent a...