Automatic downsizing and upsizing detection using scanner data and their impact on price indices

An important challenge for official statistics is the automatic detection of downsized and upsized products generating the price index bias. This paper presents the results of the authors' research on the phenomenon of downsizing and upsizing with the use of scanner data. The contribution of the paper is as follows: (1) the paper systematizes, defines and delineates all the potentially dangerous situations for measuring inflation associated with a change in product size; (2) the paper discusses the potential problems that the statistical office may encounter when trying to detect downsized and upsized products; (3) the paper proposes an automatic procedure for selecting downsized and upsized products on the basis of selected food and non-food groups of scanned products; (4) the paper presents the results of empirical studies that clearly show the impact of downsizing and upsizing on the bias of inflation measurement, with the impact assessed from the perspective of commonly known bilateral and multilateral price indices.