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Inflation is defined based on utility, not a certain level of society. The second would be something like GDP growth, much higher than inflation, and definitio

Inflation is defined based on utility, not a certain level of society. The second would be something like GDP growth, much higher than inflation, and definitionally a zero-sum game. Inflation says that you would rather prefer to live it today's society at say $60,000/year (with smart phones, cars, Internet TV), than yesterday's society at say $50,000/year (with two maids, but none of the technology). Introspecting, I would say the above decision is true for me.

manmal 5y ago
Looking at the maid's and nanny's income, I think 2020's incomes are _definitely_ preferable to 1920's for many.
jacknews 5y ago
'Hedonic' inflation can't really be measured objectively, and is somewhat useless for financial calculations, since people need to live in society. If Christie enjoyed an 'upper-middle-class' lifestyle on an official inflation-adjusted $50k salary, then it's clear that the offical inflation figures do not actually measure the 'cost of living', but something much more diffuse and subjective like the 'quality of living'.
- vba616 5y ago
  There's a direct relationship between other people making similar wages to you, and your inability to get someone to do a good job on anything at a price you can afford. If the cost of living hadn't "increased", then the middle class would still be tiny, and we wouldn't be in it. The whole thing would be moot.
csa 5y ago
> Introspecting, I would say the above decision is true for me. An alternate perspective (not contrary, just different)… My uncle and late aunt were linguists in Central and South America. They were funded modestly with American funds. When abroad, they did not have a car, but they did have a housekeeper (cooking and cleaning) and one or two nannies (two when their 3rd kid was young). They got around by scooter, or taxis if necessary. When they came to the US to raise funds, my aunt always complained about how hard it was to manage everything even though they were frequently given loaner cars and a lot of free food. Apparently the extra labor around the house made a huge difference for household management, and apparently that house help was worth way more than a car for them. When I lived abroad in a lower CoL country, I rarely cooked just because I could eat out very cheaply and relatively healthily.
- adrianN 5y ago
  That's because the real currency in life is time. Household help actively safes time. A car just allows cities to spread out further until the initial time savings experienced while cars were new are eaten up.
smnrchrds 5y ago
Don't forget about healthcare. Few people would prefer the comforts of the past if it comes with infant mortality rate of the past.

manmal 5y ago

Looking at the maid's and nanny's income, I think 2020's incomes are _definitely_ preferable to 1920's for many.

jacknews 5y ago

'Hedonic' inflation can't really be measured objectively, and is somewhat useless for financial calculations, since people need to live in society. If Christie enjoyed an 'upper-middle-class' lifestyle on an official inflation-adjusted $50k salary, then it's clear that the offical inflation figures do not actually measure the 'cost of living', but something much more diffuse and subjective like the 'quality of living'.

vba616 5y ago
There's a direct relationship between other people making similar wages to you, and your inability to get someone to do a good job on anything at a price you can afford. If the cost of living hadn't "increased", then the middle class would still be tiny, and we wouldn't be in it. The whole thing would be moot.

csa 5y ago

> Introspecting, I would say the above decision is true for me. An alternate perspective (not contrary, just different)… My uncle and late aunt were linguists in Central and South America. They were funded modestly with American funds. When abroad, they did not have a car, but they did have a housekeeper (cooking and cleaning) and one or two nannies (two when their 3rd kid was young). They got around by scooter, or taxis if necessary. When they came to the US to raise funds, my aunt always complained about how hard it was to manage everything even though they were frequently given loaner cars and a lot of free food. Apparently the extra labor around the house made a huge difference for household management, and apparently that house help was worth way more than a car for them. When I lived abroad in a lower CoL country, I rarely cooked just because I could eat out very cheaply and relatively healthily.

adrianN 5y ago
That's because the real currency in life is time. Household help actively safes time. A car just allows cities to spread out further until the initial time savings experienced while cars were new are eaten up.

smnrchrds 5y ago

Don't forget about healthcare. Few people would prefer the comforts of the past if it comes with infant mortality rate of the past.