Considering the Structure of the Consumer Expenditure: Designing Computer Assisted Interviewing 

Frank P. Stafford, Department of Economics, University of Michigan 

Introduction 

 There have been longstanding efforts to keep track of prices. The Bank of Sweden has constructed an 

historical series from 1290 to 2006. This has the purpose of understanding both the long evolution of 

prices and then working to understand the diverse influences which led to distinct periods of inflation or 

stable prices or deflation. Relative price changes would be important to now is assessing models of 

unbalanced economic growth. 

 How could such and index possibly be constructed? The answer is that the researchers focused on a 

small set of main commodities and the consumption basket was quite stable and very simple further 

back in time. The late Middle Ages were somewhat easy – with stable prices and not much change in 

what was consumed! It was not until the early 1800’s that a line had to be added for potatoes, a new 

item derivative from the Columbian Exchange with the Americas. A CAPI application for Sweden in the 

1300’s would be quite brief and the respondents would likely welcome a visitor to their rural residence. 

 The main problem for Sweden now and the U.S. now is the extreme proliferation of different kinds 

and qualities of various consumption items. Combining that with the wide array of modes of purchase 

creates a true data collection challenge, perhaps more challenging than any other set of social measures 

one can think of. And, in addition, economic content is generally regarded as the least likely to engage a 

respondent’s interest and is often seen as data overload by respondents, more anxiety producing than 

anything else. 
 

Source: “The Evolution of Swedish Consumer Prices, 1290-2008,” Rodney Edvinsson and Johan 

Söderberg, Bank of Sweden. The CPI2 allows for replacement of the coinage after periods of high 

inflation. 

 Figure 1 Swedish Prices, 1290-2006 

 If we go fast forward to 2010 for the U.S., we have the Google Price Index, constructed from on-line 

transactions. This highlights a growing complication in modern times – which is the wide range of 

purchasing modes and combined modes, such as both paying bills on-line and buying things on a 

sporadic basis. Such transactions may be missed without activating some recall of purchasing mode. 
II. Design Themes 

 The main themes to be kept in mind when redesigning a modern consumer expenditure survey is the 

ways in which the information reporting burden of the respondent can be controlled yet at the same 

time valid answers to quite detailed information – of the sort not on the minds of the respondent in that 

form – can be captured. A major theme is flexibility in reporting yet maintaining an overall 

standardization. This is possible with modern, high quality data collection software. One of several areas 

where we have used a flexible interviewing structure in the Panel Study of Income Dynamics is the use 

of Event History Calendars over the phone. In this situation the respondent cannot see the actual screen 

calendar, but the calendar design allows flexibility and a more conversational approach for the 

respondent. The interviewer also gets benefits from this flexibility and has the advantage of seeing the 

screen entries. The software can be designed to have on-the -fly calculations and checks for answers 

that don’t ad up – this can lead to soft or hard checks. 

 Hard checks may arise when the respondent reports a time gap between jobs with no labor force 

status for the intervening period. A check is also created to see if the adding up of subcomponents 

exceeds some benchmark – such as being more that 52 weeks per year. Here the flag is a ‘soft check’ 

where the internal processing within CAI produces an unlikely match or mismatch, but may be the result 

of rounding the duration of some labor market spells. These checks can trigger an interviewer inquiry, 

but unlike a hard check, where reconciliation is mandatory, the soft check allows the interview to 

continue. 

 
 Figure 2 Employment Even History Calendar 

INCORRECT REPORTING OF TIME AWAY –

“VACATION SPELL”

 Above is a screen capture from the employment Event History Calendar used in the 2009 and 2011 

PSID. Two points of interest are the tabs on the left which are different possible employment domains 

as defined in the CPS. Since there are clear rules as to what the domains are and that they are mutually 

exclusive, the data can be collected in order but can also allow the interviewer to backtrack and edit 

prior reports as new information occurs to the respondent. And as information is filled in various checks 

can be run, such as the one above, where the respondent reported a vacation when it should have been 

a period of being out of the labor force. 

 Several methods checks have been carried out for such data and a recent one was to see the potential 

for alignment of the start of spells of unemployment from the reported moths of receipt in 2008 with 

the onset of a spell of unemployment. This matchup is shown in Figure 3. There are most of the spells 
followed by UI receipt soon after. The few separated from the start could be either errors or delayed 

and or disputed receipt of benefits. 

 

Difference Between 1st Month Received Unemp. Comp. and 1st Month Unemployed 

Where 1st Month Unemp. January - June 2008

By Proxy Status

(N=151)

1 1

2 3

9

4

1

3

1

1

1

4

5 4

2 0

4

2

2 2 1

7

2

4

1

3

0

1 0

2 0

3 0

4 0

5 0

6 0

7 0

8 0

-5 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10 11

Months Difference Count

Self

Proxy

 Figure 3 Alignment of UI Receipt and Start of Spell from the EHC 

 The concept of flexibility and interaction has been applied in the effort to gain consumption measures 

in the American Life Panel (ALP). Another element is asking the respondent to report quite wide 

aggregate subtotals of consumption. Both ALP and PSID rely on quite global measures. In the case of the 

PSID consumption is not in a given section of the CATI application but is scattered throughout the 
application. Possibly this helps avoid the feeling of a long section with a list of spending categories. For 

broad total expenditures the PSID and CE align quite well. 

. 

 A similar structure of fewer, more aggregate items has also been employed in the American Life Panel 

(ALP). (See Table 2.) The strategy there and in the PSID is to carefully select the recall periodicities to 

match the expenditure category. So, spending that occurs only occasionally such as a home repair or 

renovation can be referenced in terms of the prior year (or calendar year) while food at home can be 

reported weekly or monthly. Also giving the respondent flexibility in the choice of time interval can be 

considered, and in the case of PSID this is referred to as the ‘pers’ – per week, per month,... A similar 

design issue has been addressed in the recall periodicities for ALP. Mode of purchase can be added to 

the classification system – at least as a way to encourage better recall. 

 Table 2. 

A classification of spending categories by regularity and frequency of expense 

Regularity Frequency Examples 

Somewhat regular High (weekly) Food, gasoline 

 

Regular Medium (monthly) Rent, utilities, prescription drugs (for some people) 

1999 2001 2003

Total 0.96 1.02 1.01

Food 1.03 1.08 1.1

Housing 0.94 1 0.97

Transportation 0.86 0.95 0.94

Education 1.16 1.31 1.13

Childcare 1.21 1.25 1.26

Health care 1.04 1.1 1.14

Source: Li, Schoeni, Danziger, Charles (2010), table 3.

Table 1. Ratio of average consumption expenditures in PSID

to Consumer Expenditures Survey
Regular Low (annual/semiannual) Property taxes, auto license 

Irregular Varies across households Clothing, health care copays 

Big ticket items Usually less than once/year Automobiles, home improvements 

Source: “Methodological Innovations in Collecting Spending Data: The HRS Consumption and Activities 

Mail Survey,” Michael Hurd and Susann Rohwedder. 

 An essential part of the process is an interactive reconciliation. This is true of the EHC approach and the 

expenditure approach in Alp. A partial screen capture is set out in Figure 4. 

 In table 3 are presented the consumption totals from ALP May 2009 through April 2010 for 25 

categories plus July, October 2009 and January, April 2020 for 11 additional items. As can be seen there 

are some general alignment and also some differences, notably for the age 65 and older group. 

 Table 3. 

 Spending Over a Year ALP and CEX 

 Total one-year spending 

 

 ALP April 2009 – March 2010 

 CEX 2009 

 

 All 45 or older 65 or older 

 ALP 41,723 43,814 40,582 

 CEX 43,596 44,147 35,706 

Source: Michael Hurd and Susann Rohwedder, “ Effects of the Economic Crisis on American 

Households,” Working Paper, RAND, 2010. Note: CAMS also has higher totals than CEX in oldest age 

group. 
II. A Proposed Structure. 

 The CAI structure that could be considered in the redesign of the Consumer Expenditure Survey has 

the following components. 

1. First obtain the labor force status of the family members age 15 and older as of the survey data 

and the prior calendar year. Then a summary measure of labor income from the prior calendar 

year period. In the PSID we have attempted to get income from a year prior to the last calendar 

year (t-2). Over the period, 1997 – 2007 we implemented various forms of this and have 

concluded that only major components such as labor income of the respondent and spouse and 

total family income can be meaningfully obtained. 1

 Possibly more detail could be obtained from 

shorter versions of income from the prior calendar year. As a summary add any other main 

component and then implement a CAI-based, preliminary total income for the family for year t-. 

2. To this one might add questions on any unusual sources of income such as an inheritance or a 

pension (cashed in). Or major reductions in debt or transfers to others outside the family. This 

could be used to define an ‘annual cash flow available for consumption’ or ACFC.

3. Next go through a set of rather global expenditure categories, using recall periodicities to match 

the expenditure category. The level of aggregation should be quite high. These aggregates 

should be design to match the existing CE categories but in less specific detail. 

4. After going through the broad categories there should be a reconciliation phase in which the 

components are added to a total. The respondent can then be questioned along the lines of “I 

get a total of about $MM? Does that seem about right to you? Here one could implement soft 

 

1

Yeung, W.J., Stafford, F., and Andreski, P. 2008. Assessing the Quality of Income Data Collected on A Two-Year 

Periodicity: Experience from the Panel Study of Income Dynamics. Survey Research: Method and Application, 23: 

34-80. 
checks in the difference between total income and of ACFC. Then an interactive process of 

some, but not of excessive reconciliation, could be used. 

5. After going to this point the next step would be to select at random a single consumption 

domain for added detail, Here the starting point could be the categories set out in Appendix B 

of CPI Requirements of CE2

. For example, a given family may be assigned at random to AA 

(Men’s Apparel), AB (Boys’ Apparel), AC (Women’s Apparel), AD (Girls’ Apparel). These detailed 

categories seem to be quite challenging and the CAI for the design of each should be quite 

different and should recognize both the range of potential items and also work on mode of 

payment . Were the items in AC0380311 (women’s sport coats, tailored jackets) bought at a 

store, via a catalog, via a website,...)

6. Mode of Purchase. For the specific domain of spending the respondent should be encourage to 

recall all the ways in which purchase may be carried out – including stores and maybe kinds of 

stores, catalogues, open markets, internet transactions,.... 

 Spillover across categories. The categories seem quite distinct – but if one is in focus there may 

be a tendency for ‘nearby’ items to get picked up, and across the set of families randomly assigned 

to separate categories there could be an upward bias from an accounting perspective. 

7. Gifts of goods. Gifts of services are going to be outside of the normal CEX realm. What of gifts of 

goods – especially from non-residential family members. To take an example, what if 

grandparents are paying for a non-residential grandchild’s schooling? The grandparent did not 

expend in the sense of being in their consuming household. One way is to have this as a gift 

component that connects to ACFC. And for the receiving family it would be recorded as a boost 

in their ACFC in the form of an external gift that has a market transaction value. In any event 

 

2

 CPI Requirements of CE, William Casey, mimeographed, June 17, 2010. 
there are quite substantial intra-family transfers and these need to be accounted for in an 

overall fashion – avoiding either undercounting or double counting across the families.