I agree that 'hedonic value' should be tracked, but it has no place in inflation calculations, IMHO.
For example, let's say I enjoy a fast-food burger, a BK whopper. It costs, for sake of argument $4. Now suppose, BK add some extra pickles, sauce and a bigger burger across their range, but up the price of a whopper to $4.50.
But, with a hedonic adjustment, the burger still only costs $4, since the $4.50 price rise is 'fake news' as it includes extra burger, etc.
Because this adjustment is included in the inflation figures, my next wage review will reflect the fact that I can still get 'just as much burger' for the same price as last year.
But the reality of course is that I have to pay more for the same 'level' of burger, even though it got better.
IMHO, Inflation figures should reflect the cost of inhabiting various social levels, and average those.
The overall material quality of life of a society should be an entirely separate metric, probably a replacement for GDP which is quite flawed.
I feel like the vast majority of products you're buying are either bulk purchases or have versions at many many price points, making them immune to this effect.
For example, let's say I enjoy a fast-food burger, a BK whopper. It costs, for sake of argument $4. Now suppose, BK add some extra pickles, sauce and a bigger burger across their range, but up the price of a whopper to $4.50.
But, with a hedonic adjustment, the burger still only costs $4, since the $4.50 price rise is 'fake news' as it includes extra burger, etc.
Because this adjustment is included in the inflation figures, my next wage review will reflect the fact that I can still get 'just as much burger' for the same price as last year.
But the reality of course is that I have to pay more for the same 'level' of burger, even though it got better.
IMHO, Inflation figures should reflect the cost of inhabiting various social levels, and average those.
The overall material quality of life of a society should be an entirely separate metric, probably a replacement for GDP which is quite flawed.