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The family basket is dynamic, perhaps more than politics

Taxes On January 8, it announced a change in the list of goods and services used to calculate the price indices of the economy. This list contains a set of items categorized into classes, subgroups and groups that reflect the major components of Colombian household consumption. The announcement of the Tax is nothing but a change in the family basket.

The family basket is regularly associated with debates on raising minimum wages, reforms of the national tax system (also known as financing laws), or rising prices of goods and services called inflation. The family basket seems to be associated with headaches rather than consistent statistical exercise that allows us to know the structure and behavior of the country's consumption. These are some ideas about this moment of change that will have a direct impact on our price monitors for this year, and so on a large part of our economic activity.

1. This is not a "malevolent" tax that creates fragile edits that publish lies

Due to the lack of statistical knowledge, we have a lot of the wealth of information available to us in our country, which is dangerously widespread and encouraged by ignorant speakers on social networks, and the technical rigors of Techniques Dane are not known. It is very worrying that some guild directors, some economists, some journalists, and many leaders of the printed or digital pasquenas stand out in this group. Therefore, in a statistically poorly educated country, it may be very likely that when a citizen hears, "Dane is about to change a family basket", imagine things like: (1) "This is another form of Dane to hide the truth about price behavior" (2) "Because they could not apply VAT to tax reform, they now do it around here", among other more eloquent inventions.

Change in the family basket reacts to the natural process of international statistical methodologies. An update that I think is a phrase to be used to make it stricter and respectful of statistics is a family basket as normal as a car's oil change so it still works well in a few miles. Taxes are always governed by the rigorousness of agreed methodologies in the international statistical sector, such as the fact that a population or age group is included in the calculation of unemployment, not a whirlwind, but a methodology proposed by the International Labor Organization) and agreed by a large majority of nations within a statistical conference, which takes place annually at the United Nations Headquarters in New York (United Nations).

So in this first thought I would like to emphasize that updating the family basket is a result and reflects the rigor with which Dan does and does his job for decades.

2. Great Family Basket Calculation

Like other government portfolios as an operation, Dan also appreciates and carries out operations to fulfill his obligation; who are fortunately cheaper and closer to a quiet economy than to a conflict.

To know what elements a family basket should produce, Dane has done "National Household Budget Survey (ENPH). "In this operation, thousands of households are asked to complete some brochures showing all the purchases they make (date, article or services, quantity and price basically) to obtain a representative sample, that Colombians consume each time and that the price for payment.

This extensive database serves, among other things, to identify a small list (which includes the most important products) used to estimate the average change in the prices of the economy, ie Inflation (or deflation in the given case). it decreases). It takes a lot of time for price information available in DANE. This significant operation took place in the period 2016-2017 and was preceded by the second type of National Revenue and Expenditure Survey (ENIG), which took place in 2006-2007.

On this occasion, therefore, the country has complied with what the international statistical community calls "good statistical procedures""Unlike what happened with the census of the people and houses that unfortunately remains of us as a" banana republic. "International best practices for population census are done every ten years, but the Colombian government has recently devised population census as an insignificant issue ( the former Treasury Department, Mauricio Cárdenas) has allocated budgets and resources in an average way or in a way that prevents it, its good future, but it is sand, which is the next bag I will express myself on the next occasion.

In the case of ENPH, we have done well, and the current Director of Dane has achieved the goal of introducing a change in January 2019 to have a year of transition and we can very well analyze the impact of inflation on the pooling process because all changes have implications. The impact of the new family basket on inflation will be seen when we report inflation figures for January in February.

3. Family basket is dynamic

Given that countries were unable to track all the prices of millions of articles in their markets, the most representative ones being selected from the results of a large ENPH, a short list (about hundreds, not thousands or millions) of the main items of consumed households and monitored monthly. This is how inflation is calculated from the change in the price of goods that is part of the family basket, which includes items and services of the main items of household consumption: food, housing, clothing, health, education, entertainment, transport, communications and other expenses.

The participation of each of these groups informs us very much about the structure of the country's consumption.

For example, the Colombian case is slightly more than 72% of household spending on food (28%), housing (30%) and transportation (15%).

For the case aleman, housing accounts for 31 percent, but only food 10 and transport 13 households spends more than 53 percent, leaving more room for consumption of other goods (holidays or electronic items). In the Canadian case, food is 16 percent, housing is 26, while transport is at 20. In a country like Bangladesh, more than 50 percent go to food 22 for housing and 8 for transportation.

The consumer basket therefore varies according to where it is measured, income levels, productive organization, economic development, as well as its habits, traditions, cultures.

Changing all of these determinants does not only happen when we change the place (country or region) also occurs when time passes. Before the economy consumes axes a day, typewriters communicate, then diskettes to archive information and now digital platforms watch movies and series.

Companies are changing over time and in order to adequately measure the impact of changes in the general price level, it is necessary to update the products we manage. This means adjusting the family basket we use to monitor inflation. It is really exciting to see through our product list how our company is changing, so I invite you to look at it a list of products that have come and gone, so you can get an idea of ​​how our country has changed over the past 10 years.

In the last ten years, in Colombia, products typical of traditional rural economies such as ulcus, beans, barley curuba, caraway, pepper and laurel have not been relevant to household consumption. This could be evidence of changes in household eating habits, greater urbanization of the country, or perhaps changes in the profitability of such food production, which leads to the fact that they are not available on the market.

They also left furniture for computers and furniture for the library, which may be the result of the versatility of computers today (laptops, tablets and smartphones) as well as a decrease in the number of books in Colombian homes. In terms of energy, matches appear, perhaps due to new forms of fire use, such as a cigarette lighter, and greater electric current stability and battery discharge as current systems use rechargeable batteries and are only used in very specific appliances

As for fashion, it seems that less and less shoes are polished and women no longer use half of their legs. And it seems that shoes are no longer repaired so that we are increasingly immersed in the dynamics of "fast-paced fashion ", which means more waste generation.Electrical appliances and containers are no longer repaired earlier, which is another proof of the one-off entry into the economy.It leaves some devices that ruled in the nineties such as compact discs, printers, recorders, cameras and they enter the shaving machines and hair irons, machines that rule the 21st century as computers, televisions or mobile phones do not go or do not, even though they are changing and improving technology.

In the case of Colombian households, football tickets are no longer relevant to their consumption and are now spending more on renting football fields, bicycle, pedicure and tolling accessories, indicating that they are now offering collective goods (for example, sports facilities) sector, instead of a collective action (club, residential complex, or community park), that people get used to non-fuel vehicles, especially bicycles, that pedicures are becoming more common. The arrival of a toll in a family basket may indicate that homes are traveling more or that they are "metropolitanized" and live outside cities, tolls are becoming a daily cost.

From the point of view of health care, we must pay close attention to the fact that there are "heavy" expenditures such as cardiology, gynecology, ambulance, hospitalization and ambulances, and we enter into "soft" spending such as bandages, pregnancy tests, hot water bottles , Homeopathic Medicines Impact Indicator of Better Coverage in Colombian Healthcare. It is disturbing that the entry of mineral water for consumption in the house, because it is evidence of the decline of systems of aqueducts or new enterprises fitted to basic human needs.

Viagra, brandy, lottery and Baloto go out of the family basket. Visit a website such as tequila, Christmas wreath, pet services, sunglasses and English courses. We've changed on some issues and it's worthwhile looking for you to make your own analysis a list of those things that are going to get to know us a bit better.

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