William Stanley Jevon's Contribution to Index Number Theory

Walter Bagehot responds negatively to William Stanley Jevon's proposal to construct a price index based upon household consumption, and then use the index to adjust contracts to reflect variations in the purchasing power of money. This is from an 1875 edition of The Economist:

A New Standard of Value, by Walter Bagehot, The Economist, November 20, 1875, reprinted in the Economic Journal, volume 2 (1892): Professor Jevons, of Manchester -- so well known in the economical and statistical world by his researches on coal -- has written an excellent treatise on 'Money and the Mechanism of Exchange', which we strongly recommend to our readers. It is extremely clear, brief without being dry, and contains a good deal of very interesting information. And we may add that it is written in a style of scientific modesty rare in currency books. Mr Jevons is perpetually aware that the subject abounds in questions of nicety and difficulty, on which he is quite ready to admit that he may be wrong. It would be a happy thing if persons far less competent than Mr Jevons to write on the subject, but who incessantly do so, could be brought to that admission.

On one point, however, we are at issue with Mr Jevons: he has far more hope from economical science than we have. He thinks that it can point out to mankind a far better theoretical standard of value than gold or silver, and believes that, though it is encumbered with some difficulties, probably the new plan would on the whole, when we got used to it, work better than our present one. But for ourselves we much fear that political economy has no such boon to confer on mankind, and that we must adhere to one or other of the precious metals as a standard of value, like our forefathers. Mr Jevons shall explain his fundamental idea in his own words.