Inflation, which reached 6.2% over twelve months at the end of October, against 10.7% on average in the euro zone, would it not be underestimated in France? Faced with soaring prices among traders or electricity bills, some are wondering. Alternative price indices, in the form of a “supermarket trolley”, are published by consumer associations or the media, including by The world. “These debates about the discrepancy between the perception of inflation and the actual figure are not new at all”, observes Michel-Pierre Chélini, professor of contemporary history at the University of Artois. In the 1970s, the CGT even produced its own indicator, based on a consumption basket for a working-class family. During the changeover to the euro, the debate around the reality of rising prices was inflamed.
Today, it is paradoxically not as virulent as one might have anticipated given the level of inflation. “We don’t get the impression that there are big gaps between our measure of inflation and what the alternative indicators are saying”, observes the Director General of Insee, Jean-Luc Tavernier. To calculate the price index, the statistics institute does not skimp on resources.
Each month, the investigators collect approximately 160,000 prices from 26,000 points of sale, spread throughout the territory, including overseas. Added to this are 500,000 readings on the Internet and, since 2020, cash register data from supermarkets. Enough to follow the evolution of the prices of approximately 80 million products. The basket of goods and services taken into account for the calculation of the index is updated according to changes in consumption patterns: each year, around fifty to a hundred products enter it, while fifteen at twenty come out. And work is underway on how to take new forms of sales into account: e-commerce, delivery costs, etc.
“Quality effect” and “shrinkflation”
But the exhaustiveness of the method does not exclude recurring debates on two points. The first relates to taking housing into account. INSEE only measures the increase in rents and not the cost of housing for first-time owners, for example. Results : “Rents represent only 6% of the index’s consumption basket, whereas, according to the Family Budget survey, they weigh, in reality, between 16% and 17% in expenditure, and this can go up to 50% for students »notes Florence Jany-Catrice, professor of economics at the University of Lille and author of Consumer Price Index (The Discovery, 2019). For INSEE, integrating the cost of a real estate acquisition amounts to mixing cabbage and carrots: “It is an investment, not a consumption expense”, replies Mr. Tavernier. Few countries, moreover, make this choice.
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