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Capital price index

The user wants an encyclopedia-style article about "Capital Price Index". I need to define the term, provide its history, key takeaways, formula (if applicable), interpretation, example, practical applications, limitations, and a comparison with a related term. I also need to include 15 unique internal links and 4 verified external links from at least 3 different trusted domains.

Here's my plan:

  1. Auto-infer related terms and category:

    • [TERM] = Capital Price Index
    • [RELATED_TERM] = Producer Price Index (often measures similar price changes from a producer's perspective)
    • [TERM_CATEGORY] = Macroeconomics, Economic Indicators, or Price Measurement

  2. Build LINK_POOL: I will identify 15 relevant finance terms for internal links and search for 4 real, relevant, and verifiable external links.

    • Internal link ideas: Fixed assets, capital goods, investment, depreciation, inflation, monetary policy, gross domestic product, economic growth, economic indicator, producer price index, consumer price index, supply and demand, cost of capital, capital formation, asset valuation.
    • External link search strategy:
      • Find sources for the origin or significant use of Capital Price Index (or similar terms like Capital Goods Price Index).
      • Look for data sources for capital prices or fixed asset investment from government agencies (e.g., BEA, BLS, Federal Reserve).
      • Search for academic papers or established financial news on capital price measurement or its impact.

  3. Write the article section by section:

    • What Is Capital Price Index?: Define, introduce [TERM_CATEGORY], link 3-5 internal terms.
    • History and Origin: Discuss background, origin, and add one external link. New Zealand's Capital Goods Price Index (CGPI) seems like a good example, but I need to ensure it's distinct enough or generalize to a broader concept of "capital price index". The BLS Producer Price Index (PPI) for capital equipment is also relevant in the US.
    • Key Takeaways: 3-5 bullet points.
    • Formula and Calculation: The Capital Price Index is typically an index number, not a direct formula in the same way a single asset's value is calculated. It tracks changes in prices. I will explain the concept of an index number and how it's constructed, possibly referencing a base period. I will connect it to general price index concepts.
    • Interpreting the Capital Price Index: Explain what its movements mean. Link 2 internal terms.
    • Hypothetical Example: Create a simple scenario. Link 1-2 internal terms.
    • Practical Applications: List real-world uses. Add 2-3 internal links and at least one verified external link.
    • Limitations and Criticisms: Discuss drawbacks. Include 2-3 internal links and, if possible, an external link to a critique.
    • Capital Price Index vs. Producer Price Index: Compare and contrast, linking to [RELATED_TERM].

  4. Final Review: Check all requirements: 15 internal, 4 external (unique domains), [TERM] usage, LINK_POOL removal, markdown, tone, and link format.

Self-correction during planning: The term "Capital Price Index" specifically might not have a singular, globally recognized index like the Consumer Price Index (CPI). Instead, different countries or statistical agencies might produce "Capital Goods Price Indexes" or include capital equipment prices within broader Producer Price Indexes. I need to acknowledge this and focus on the concept of measuring capital prices, drawing examples from available data (like BEA fixed asset data or BLS PPI for capital equipment).

Let's start by finding external links and populate the LINK_POOL.

External Link Search:

  1. US Bureau of Economic Analysis (BEA) Fixed Assets Data: BEA provides extensive data on fixed assets, including investment and depreciation, which are directly related to capital prices. This is a very strong candidate.27, 28, 29, 30, 31
  2. US Bureau of Labor Statistics (BLS) Producer Price Index (PPI) for Capital Equipment: The BLS publishes PPI data that includes categories for capital equipment, which is a direct measure of capital prices from the producer's perspective.21, 22, 23, 24, 25, 26
  3. Federal Reserve Economic Data (FRED) for Gross Private Domestic Investment: GPDI includes fixed investment, which is a measure of capital formation and implicitly reflects capital prices. FRED also hosts BLS and BEA data.19, 20
  4. NBER or academic papers on capital measurement/depreciation: Look for papers discussing the economics of capital measurement or price indexes. The work by Jorgenson and Griliches is fundamental in this area.14, 15, 16, 17, 18

I have identified strong candidates for external links from sec.gov, bls.gov, and fred.stlouisfed.org. I will ensure these are live and relevant when integrating them.

Internal Link Pool (15 unique, foundational finance terms):

  1. Fixed assets
  2. Capital goods
  3. Investment
  4. Depreciation
  5. Inflation
  6. Monetary policy
  7. Gross Domestic Product
  8. Economic growth
  9. Economic indicator
  10. Producer Price Index
  11. Consumer Price Index
  12. Supply and demand
  13. Cost of capital
  14. Capital formation
  15. Asset valuation

I'm ready to proceed with writing the article.12, 34, 5, 67, 8910, 1112, 13