Question

What is the main advantage of the billion prices project over the cpi?

Answer 1

The billion prices project monitors online information about prices. The advantage of using online data is that it is very hard to manipulate by a specific government since everyone can access it.

This project started in response to the government manipulation of the CPI in Argentina (and later in Venezuela). Government officials can forge information about the inflation rate, but the project started researching online prices and those cannot manipulated by the government.

Currently PriceStats (a private company) monitors online prices on a daily basis, and that is something impossible to do on brick and mortar stores.

Answer 2

The advantage is that many prices can be monitored daily. The consumer price index is a measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care.  Billion prices project aggregates price information from multitude of online retailers around the world and gives them real time inflation predictions.