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It's not a contradiction. A 1980 Dodge Aspen cost under $5000, and was a large sedan capable of carrying 6 passengers. From a consumer's point of view, a compa
by blagie 5y ago
It's not a contradiction.
A 1980 Dodge Aspen cost under $5000, and was a large sedan capable of carrying 6 passengers. From a consumer's point of view, a comparable car today -- something suitable for transporting a family with three kids -- is around $20,000, so about 3% annual inflation.
http://blog.consumerguide.com/wp-content/uploads/sites/2/2017/10/Dodge-741x1024.png http://blog.consumerguide.com/wp-content/uploads/sites/2/201...
On the other hand, a 2021 Kia Soul or Chevy Trailblazer have features which wouldn't exist on a 1980 vehicle, or only be available on super-luxury models, so if they sold in 1980, they'd probably be $20k. Zero inflation. They have:
* Crumple zones
* Air bags
* AC
* Much better gas mileage
* Power windows
* Touch screens
* Various driver-assist systems
* Cell phone connectivity / bluetooth
* ... and so on
It depends on how you squint; data can paint either conclusion. On a related note, if you wanted a 2021 car with the same amount of steel as a Dodge Aspen, you'd be looking at a lot more than $20k; cars back then were built in ways which required a lot more material (an upside being maintainability; you could pop the hood and do a lot of work yourself).
- Thorrez 5y agoOk, so the graph isn't showing the price change of actual cars that people buy, buy hypothetical cars invented based in feature set. It's kind of a weird comparison, because it makes it seem like people less in inflation-adjusted dollars, when in fact that's not true.
- blagie 5y agoThat's a universal problem in estimating inflation. People buy different things, and products come and go. How do you compare a house build to 1900 standards to one build to 2020 standards? How do you compare fresh foods from the local farmer to factory-manufactured ones? People shift preferences based on prices too. Manufactured goods started out as premium products, and now, fresh foods are increasingly a premium product. It's an impossible problem. People either do their best, or lie with statistics, depending on the domain.