Monetary Adjustment Feature

The Adjust Monteary Values (AMV) feature allows users to request an inflation-adjusted version of variables to be included in their IPUMS USA extracts; using this feature will add a new variable that reports values that have been converted to 2010 dollars. For more information on the feature and underlying infrastructure, please read our working paper.

The Consumer Price Index (CPI) is a measure produced by the Bureau of Labor Statistics to indicate the relative price of a set of goods and services across time in the United States. The CPI for all urban consumers (CPI-U) is the most widely used of price indexes. It is computed monthly based on expenditure patterns and annual average indexes represent the average over the 12 months of the calendar year. The CPI-U and additional information about consumer price indexes are available on the U.S. Bureau of Labor Statistics website.

IPUMS has selected the CPI-U as the default price index because of its widespread use and availability across a long time span. The CPI-U is available back to 1947 in its seasonally adjusted form. For the 1921 to 1946 period, a national index is available but it is not seasonally adjusted. An index was estimated by the Bureau of Labor Statistics for the 1913 to 1920 period. Samuel H. Williamson of Measuring Worth has compiled a series back to 1774 which enables us to extend the CPI-U series back to 1850, the first year for which we have census microdata in IPUMS USA. These data are available on the Measuring Worth website.

Missing data codes
In the adjusted version of a variable, the adjustment factor is only applied to codes that represent monetary values in the original variable, including top and bottom codes. Missing data codes (NIU, Refused, Don't Know, and No response) from the original variable are compressed into a single code consisting entirely of 9s in the adjusted version of the variable. This single missing data code is two digits wider than the missing codes in the original variable; the code is analogous to NIU for the adjusted variable.

Reference year
IPUMS USA includes a variable called YEAR that reports the year when the data were collected. However, the YEAR variable does not necessarily represent the reference year for monetary values reported in that dataset. To correctly adjust variables for inflation, AMV must use the appropriate reference year for each variable. The reference year for monetary variables are generally consistent within a sample; therefore, we specify a default reference year for each sample. Questions used to generate monetary variables in the decennial census often reference the previous calendar year; we set the default reference year for decennial samples as the previous year. The questions used to generate monetary variables in the ACS and PRCS often reference the past 12 months. ACS and PRCS data are collected on a rolling basis. The month of data collection is not reported in the public use microdata sample released by the Census Bureau; it is therefore not possible to determine if the majority of the reference period occurred during the current/survey or previous year. We set the default reference year for ACS and PRCS as the survey year (i.e., YEAR). Because IPUMS already adjusts monetary values reported in multi-year ACS/PRCS files to dollars for the last data year (i.e., 2023 dollars for the 2019-2023 5-year file), Adjust Monetary Values also uses the last year of multi-year files (reported in the variable YEAR; MULTYEAR reports the original survey year) to inflate/deflate to 2010 dollars.

In some cases, AMV applies a variable-specific reference year regardless of the default reference year for the sample. We use this option if a variable's reference year is consistent across all samples. For example, mortgage payments are reported as a monthly amount in both decennial and ACS/PRCS samples; AMV overrides the sample-default for decennials and instead always assumes the reference year is the survey year for the variables MORTAMT1 and MORTAMT2. We assign the survey year as the reference year for questions asking respondents to report monthly values. For questions asking respondents to report an annual amount, we assign the previous year as the reference year.

In an extremely limited number of cases, the reference year for a variable regularly diverges from the sample default and is inconsistent within the variable across time. Electricity costs provide an illustrative example: the questionnaire asks for average monthly costs in 1970-1980, annual costs for the last 12 months in 1990, annual costs without an explicit reference period in 2000, and last month's costs in the ACS and PRCS. In these cases with heterogenous reference years, we will select the reference year that accommodates the majority of the samples (using either a variable-specific reference year or sample defaults) and document the samples that use a misaligned reference year in the variable level documentation. If neither approach (variable-specific reference year or sample default) accommodates a majority of samples, we will not offer the variable for adjustment. Reference year details are included in the variable-level documentation and listed below.

The AMV feature is currently available for the following variables: