6 ms·

You can not even buy a house built on the 1950s on 70k a year. And while most quality claims (which usually lack actual numbers) certainly look subjective, the

You can not even buy a house built on the 1950s on 70k a year. And while most quality claims (which usually lack actual numbers) certainly look subjective, the quality of a dirt lot or vial of insulin has obviously not changed while their adjusted inflation price has sky rocketed. At any rate, the claim that "stuff" is more expensive because it is better implies that decades of technical improvements have resulted in no efficiency gains. At best, it implies the value per man hour has essentially remained flat. And since the option of buying lower priced versions of items has dispersed, we can never know if the higher quality item is fairly priced.

eru 7y ago
Dirt has become enormously more expensive. The more dignified term to use here is 'land prices have increased.' One could argue that the quality of the dirt has improved a lot; or at least the quality of its location. The US in 2020 is a much richer place than the US in 1950; so we'd expect land to cost more. (But in addition, there are those restrictions on housing supply that I already mentioned.) You are right about insulin probably not having gotten much better. There's a few other goods like that as well. Some of those problems are self-inflicted. Eg education is much more costly these days, too. Who claimed that stuff is more expensive because it's better? Taking hedonic adjustments into account when producing inflation numbers is the proper thing to do. Productivity improvements would then show up by decreases in the price level measured like that. We can see that for eg computers. A good enough desktop computer today costs less in nominal dollars than in the early 90s, despite being enormously more powerful. Yes, you are right that we can not buy many of the crappier things any more. That's partially down to regulation, but also down to there just not being enough demand for lots of crappy stuff to keep production at scale running. So that makes calculating the price level harder. The usual work-around is to only look at adjustments from one year to the next, and chain them. Another workaround is to go with the Big Mac index. (https://en.wikipedia.org/wiki/Big_Mac_Index https://en.wikipedia.org/wiki/Big_Mac_Index) That index is a bit of a joke, since it just measure the price of a Big Mac. But it's surprisingly useful for what it is.
- vonseel 7y ago
  Not sure where you’re going with the can’t buy crappy stuff anymore argument, from another perspective, most things built today are crappy Chinese junk compared to things built 70 years ago, if they existed 70 years ago. Mending and the art of repair has been forgotten by most - if your TV has an issue, you’re more likely to buy a new one than fix it, even if it’s possibly repairable for less than a couple hundred bucks by someone who knows there way around electronics. Same goes for clothing, small appliances like blenders or table fans, and a lot of other things. OTOH, something like a fridge today is much more efficient than it was 50 years ago, but it may not be as easily repairable or simple - look at cars nowadays versus the cars before 90/00s - no computers easy to fix. Now you buy a Tesla that is put together like an iPhone.
  - sokoloff 7y ago
    When you can buy a 50" LED 4K TV for under $300, why would you attempt a repair of any older tech TV that is "probably repairable" for a couple hundred bucks? Take it off the wall; find a repair place; make an appointment; schlep it over there; wait for the results; pick it up; put it back on the wall vs drive to BestBuy and buy a newer, better TV and put the old one on the curb and be done with certainty tomorrow. Any commodity TV is immediately beyond-economic-repair, IMO. 1 - https://www.bestbuy.com/site/samsung-50-class-led-nu6900-series-2160p-smart-4k-uhd-tv-with-hdr/6268403.p?skuId=6268403 https://www.bestbuy.com/site/samsung-50-class-led-nu6900-ser... (literally the first search result I found)
    - ryandrake 7y ago
      It makes sense if you can repair it with a few $0.15 capacitors and an hour of your time. I repair my electronics when they fail, and it saves me a lot of money. Somehow, it's become cool just to throw perfectly serviceable stuff in a landfill rather than watch a YouTube video and learn a little soldering.
      - sokoloff 7y ago
        Yes, I'm also personally very likely to tear it apart and see if I can replace any failed electrolytics, but that's only applicable to 0.5% of the population or less. I'm doing that as the least hassle way to get a working TV again (less research, less driving, no changing the TV mount, etc). 99.5+% of people are better off economically and time-wise to throw away any out-of-warranty TV undiagnosed and buy new.
1123581321 7y ago
Insulin quality and delivery methods have repeatedly improved.
maxerickson 7y ago
The quality of insulin went up a great deal ~1980 when human insulin produced in bacteria came to market. That's the stuff you can get at Walmart for $25 a vial. Prior to that, the source of insulin had been the bovines. The more expensive insulins that are on the market have different effect profiles that (somewhat) simplify managing blood sugar.

eru 7y ago

Dirt has become enormously more expensive. The more dignified term to use here is 'land prices have increased.' One could argue that the quality of the dirt has improved a lot; or at least the quality of its location. The US in 2020 is a much richer place than the US in 1950; so we'd expect land to cost more. (But in addition, there are those restrictions on housing supply that I already mentioned.) You are right about insulin probably not having gotten much better. There's a few other goods like that as well. Some of those problems are self-inflicted. Eg education is much more costly these days, too. Who claimed that stuff is more expensive because it's better? Taking hedonic adjustments into account when producing inflation numbers is the proper thing to do. Productivity improvements would then show up by decreases in the price level measured like that. We can see that for eg computers. A good enough desktop computer today costs less in nominal dollars than in the early 90s, despite being enormously more powerful. Yes, you are right that we can not buy many of the crappier things any more. That's partially down to regulation, but also down to there just not being enough demand for lots of crappy stuff to keep production at scale running. So that makes calculating the price level harder. The usual work-around is to only look at adjustments from one year to the next, and chain them. Another workaround is to go with the Big Mac index. (https://en.wikipedia.org/wiki/Big_Mac_Index https://en.wikipedia.org/wiki/Big_Mac_Index) That index is a bit of a joke, since it just measure the price of a Big Mac. But it's surprisingly useful for what it is.

vonseel 7y ago
Not sure where you’re going with the can’t buy crappy stuff anymore argument, from another perspective, most things built today are crappy Chinese junk compared to things built 70 years ago, if they existed 70 years ago. Mending and the art of repair has been forgotten by most - if your TV has an issue, you’re more likely to buy a new one than fix it, even if it’s possibly repairable for less than a couple hundred bucks by someone who knows there way around electronics. Same goes for clothing, small appliances like blenders or table fans, and a lot of other things. OTOH, something like a fridge today is much more efficient than it was 50 years ago, but it may not be as easily repairable or simple - look at cars nowadays versus the cars before 90/00s - no computers easy to fix. Now you buy a Tesla that is put together like an iPhone.
- sokoloff 7y ago
  When you can buy a 50" LED 4K TV for under $300, why would you attempt a repair of any older tech TV that is "probably repairable" for a couple hundred bucks? Take it off the wall; find a repair place; make an appointment; schlep it over there; wait for the results; pick it up; put it back on the wall vs drive to BestBuy and buy a newer, better TV and put the old one on the curb and be done with certainty tomorrow. Any commodity TV is immediately beyond-economic-repair, IMO. 1 - https://www.bestbuy.com/site/samsung-50-class-led-nu6900-series-2160p-smart-4k-uhd-tv-with-hdr/6268403.p?skuId=6268403 https://www.bestbuy.com/site/samsung-50-class-led-nu6900-ser... (literally the first search result I found)
  - ryandrake 7y ago
    It makes sense if you can repair it with a few $0.15 capacitors and an hour of your time. I repair my electronics when they fail, and it saves me a lot of money. Somehow, it's become cool just to throw perfectly serviceable stuff in a landfill rather than watch a YouTube video and learn a little soldering.
    - sokoloff 7y ago
      Yes, I'm also personally very likely to tear it apart and see if I can replace any failed electrolytics, but that's only applicable to 0.5% of the population or less. I'm doing that as the least hassle way to get a working TV again (less research, less driving, no changing the TV mount, etc). 99.5+% of people are better off economically and time-wise to throw away any out-of-warranty TV undiagnosed and buy new.

1123581321 7y ago

Insulin quality and delivery methods have repeatedly improved.

maxerickson 7y ago

The quality of insulin went up a great deal ~1980 when human insulin produced in bacteria came to market. That's the stuff you can get at Walmart for $25 a vial. Prior to that, the source of insulin had been the bovines. The more expensive insulins that are on the market have different effect profiles that (somewhat) simplify managing blood sugar.