page_title: United States Chained Consumer Price Index
section_title: Distribution effect
hierarchical_section_title: United States Chained Consumer Price Index / Distribution effect
caption_attribution_description: English: United States Chained Consumer Price Index
context_page_description: The United States Chained Consumer Price Index, also known as chain-weighted CPI or chain-linked CPI is a time series measure of price levels of consumer goods and services created by the Bureau of Labor Statistics as an alternative to the US Consumer Price Index. It is based on the idea that when prices of different goods change at different rates, consumers will adjust their purchasing patterns by purchasing more of products whose relative prices have declined. This reduces the cost of living. The "fixed weight" CPI also takes such substitutions into account, but does so through a periodic adjustment of the "basket of goods" that it represents, rather than through a continuous adjustment in that basket. Application of the chained CPI to federal benefits has been controversially proposed to reduce the federal deficit.
context_section_description: Moving to the chained CPI would reduce Social Security benefits by 3% for the bottom 60% of Social Security recipients and 4% for the top 40% of beneficiaries (per estimates for 2050 from the Social Security Administration ).
  The Tax Policy Center estimated that changing the Chained CPI would increase the taxes paid by 30% of the bottom 20% of the income distribution, 70% of the next 20% of the population, and nearly all of the people in the top 60% of the income distribution.
caption: Average percent reduction in Social Security benefits
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