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This is the same case in US. The cost of construction has far outpaced inflation by order of a couple of magnitudes while technology keeps getting cheaper and l

This is the same case in US. The cost of construction has far outpaced inflation by order of a couple of magnitudes while technology keeps getting cheaper and labor prices are still stagnant for decades. Amazingly, it's exactly reverse case in China where construction prices have fell through the roof.

salvad0r 7y ago
"fell through the roof"; I'm not sure whether that's high and went low or low and went high. From the context I'm assuming that means its gotten very cheap?
- frosted-flakes 7y ago
  It means that construction prices used to be through the roof (very high). Now they've fallen back down through the roof to somewhere on the main floor, but not in the basement.
NTDF9 7y ago
When you really think about it deeply, better production should depress prices because of econ 101. However, the FED induced inflation in assets has made everything out of control.
eru 7y ago
> [...] and labor prices are still stagnant for decades. Labour's share of GDP has roughly stayed constant. GDP per capita has increased, both real and nominal.
- deleted 7y ago
  [deleted]
- Retric 7y ago
  It’s fallen significantly: https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-labor-share.htm https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-... However, in the late 20th century—after many decades of relative stability—the labor share began to decline in the United States and many other economically advanced nations, and in the early 21st century it fell to unprecedented lows. PS: In terms of overall GDP a numbers (edit: not real data) 21% vs 17% may seem more or less stable but that’s a 20% drop or roughly all inflation adjusted per capita GDP growth over the last 20 years.
  - eru 7y ago
    Where does the 21% vs 17% come from? The graphs in that article seem to hover around 56% to 66% for the labour share since 1947. What am I missing? But looking at the graphs, there seems to have indeed been a big drop in the labour share since the dot com boom. If I remember right, the capital share has been stable. But the share going to real estate has exploded. And that's likely for the same underlying reasons construction costs have skyrocketed. See https://www.brookings.edu/bpea-articles/deciphering-the-fall-and-rise-in-the-net-capital-share/ https://www.brookings.edu/bpea-articles/deciphering-the-fall... and https://ftalphaville.ft.com/2014/02/03/1759582/piketty-and-the-case-for-land-capital/ https://ftalphaville.ft.com/2014/02/03/1759582/piketty-and-t...
    - Retric 7y ago
      Sorry, the context was missing. The 21% vs 17% was not meant to be representative of overall numbers. I just recall someone minimizing the impact by referring to some income bracket then comparing it to GDP. My point was simply people overestimate how much per capita GDP is growing, so numbers that look similar can represent large shifts. Anyway, it’s 1AM so I am a little out of it.

salvad0r 7y ago

"fell through the roof"; I'm not sure whether that's high and went low or low and went high. From the context I'm assuming that means its gotten very cheap?

frosted-flakes 7y ago
It means that construction prices used to be through the roof (very high). Now they've fallen back down through the roof to somewhere on the main floor, but not in the basement.

NTDF9 7y ago

When you really think about it deeply, better production should depress prices because of econ 101. However, the FED induced inflation in assets has made everything out of control.

eru 7y ago

> [...] and labor prices are still stagnant for decades. Labour's share of GDP has roughly stayed constant. GDP per capita has increased, both real and nominal.

deleted 7y ago
[deleted]
Retric 7y ago
It’s fallen significantly: https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-labor-share.htm https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-... However, in the late 20th century—after many decades of relative stability—the labor share began to decline in the United States and many other economically advanced nations, and in the early 21st century it fell to unprecedented lows. PS: In terms of overall GDP a numbers (edit: not real data) 21% vs 17% may seem more or less stable but that’s a 20% drop or roughly all inflation adjusted per capita GDP growth over the last 20 years.
- eru 7y ago
  Where does the 21% vs 17% come from? The graphs in that article seem to hover around 56% to 66% for the labour share since 1947. What am I missing? But looking at the graphs, there seems to have indeed been a big drop in the labour share since the dot com boom. If I remember right, the capital share has been stable. But the share going to real estate has exploded. And that's likely for the same underlying reasons construction costs have skyrocketed. See https://www.brookings.edu/bpea-articles/deciphering-the-fall-and-rise-in-the-net-capital-share/ https://www.brookings.edu/bpea-articles/deciphering-the-fall... and https://ftalphaville.ft.com/2014/02/03/1759582/piketty-and-the-case-for-land-capital/ https://ftalphaville.ft.com/2014/02/03/1759582/piketty-and-t...
  - Retric 7y ago
    Sorry, the context was missing. The 21% vs 17% was not meant to be representative of overall numbers. I just recall someone minimizing the impact by referring to some income bracket then comparing it to GDP. My point was simply people overestimate how much per capita GDP is growing, so numbers that look similar can represent large shifts. Anyway, it’s 1AM so I am a little out of it.