Online CASE CPI: A relation between online and offline indices confirms the difference between both markets; online markets more competitive

 

In October 2015, CASE launched the Online CASE CPI - consumer price index based entirely on online prices. Our experts have been measuring online prices in Poland for six months now. CASE economist, Bartosz Radzikowski, presented the outcomes of the research at the first International Conference on Advanced Research Methods and Analytics CARMA 2016 in Valencia.

 

Radzikowski discussed the methodology, advantages and preliminary findings of the Online CASE consumer price index during the Big data in official statistics session. 

 

Radzikowski summarized first observations based on the 6-moth research. According to the expert, there might be a cohesion relation between online and offline indices in Poland, but it is too early to conclude on that. However, in certain categories, prices significantly differs, which confirms substantial differences between the online and offline markets. For example, online market reacts quicker to competitors behaviors and adjust faster to changes on the market in terms of offer and shop appearance. In the case of Poland, it was visible in the “Food and baverages” category. Based on the research, online prices were shrinking online whilst growing offline. 

 

Radzikowski also referred to the Online CPI indices methodology and noted that online price indices reduce the time delay between measuring prices and announcements of the results and therefore can be published more frequently. Nonetheless, we need to be aware that availability of certain goods and services online and offline differs: there are more goods than services available in the Internet. Moreover, e-commerce is a growing but still small fraction of total consumption.

 

The relation between the Online CASE CPI, and the Polish official CPI is represented below. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The presentation has attracted considerable interest from international experts and scholars dealing with application of Big Data to official statistics. 

 

CARMA is a forum for researchers and practitioners to exchange ideas and advances on how emerging research methods with a usage of Big Data, and Web Data in particular, are applied to different fields of social sciences as well as to discuss current and future challenges.

 

Please find Bartosz Radzikowski's presentation below.