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The increase in the quality of available goods often greatly outpaces the increase in price (the opposite of shrinkflation). People don’t mind this because they

The increase in the quality of available goods often greatly outpaces the increase in price (the opposite of shrinkflation). People don’t mind this because they are ultimately concerned about their overall quality-of-life. Take cars as an example. Both build quality and available features have dramatically outpaced the increase in prices over the years. If there were a significant demand for crappy cars with 90s-era quality (and commensurately low pricing), they would be available for sale. The fact that they’re not means nobody wants to buy them. It would be extremely cheap to manufacture a basic car with few features (thus requiring fewer overall parts) and low build quality (thus requiring a less sophisticated factory), but nobody wants a new car with no air conditioning, minimal sound deadening, low horsepower, crude construction, and 5 digit odometer reliability.

IncRnd 5y ago
It's odd that you are even creating these arguments that prices don't increase. Not everyone cares about Price/component cost/feature set/quality. The truth is that the actual real-world cost for what people view as the same item, in this case an iphone, has increased year-over-year. > People don’t mind this because they are ultimately concerned about their overall quality-of-life. Of course people mind paying more and more each year. > nobody wants a new car with no air conditioning, minimal sound deadening, low horsepower, crude construction, and 5 digit odometer reliability. Those portions essentially cost nothing in the overall build cost of a car. Every car has had A/C for years. An odometer, seriously? Again, the truth for buyers is that the cost of a car goes up year over year. If we set your hyperbole to the side, people do purchase entry-level vehicles when they are introduced to the market. Many times the demand outstrips the supply, because of price.
kansface 5y ago
90s era cars aren’t close to meeting current requirements. The new requirements may in fact explain all of the price increases. I imagine there would be a market for a “new 2005” civic at say 7k$, because one exists for the old ones at 2k.
- MontyCarloHall 5y ago
  New safety and emissions standards are part of it, but don’t explain everything. Engines have gotten more powerful and more efficient, and the extra power isn’t just to keep up with additional weight due to all the new required safety features (which are a good thing, BTW!). Compare 0-60 times and handling between old and new cars. A new Accord Sport does 0-60 in 5.5 seconds, which was firmly in serious sports car territory in the 90s, and was borderline supercar territory in the 80s. Materials and fit and finish of new cars are also way better than they used to be. Reliability has greatly improved too over the last few decades, though that’s plateaued somewhat in the last decade or two, likely due to increased complexity. Remember, in the 80s and even into the mid-90s, cars often came with 5 digit odometers because they weren’t expected to last more than 100,000 miles. If there were a robust market for brand new 2005 Civics, automakers would capitalize on it. The Mitsubishi Mirage[0] is the closest thing on the market I can think of to this. It has the feel of an economy car from around 2005, and sells brand new for $14,000, which coincidentally is almost exactly the non-inflation adjusted MSRP of a 2005 Civic. It sells poorly. Most people don’t want to buy a new car that feels like it’s 15 years out of date. [0] https://www.youtube.com/watch?v=5aCsNs3eYTE https://www.youtube.com/watch?v=5aCsNs3eYTE
  - ThalesX 5y ago
    In my backwards East European country, most people outside of cities use cars for utility purposes. As such, they keep very old cars, and if they need to change, they buy some second-hand ones from Germany and so on. With the new environmental regulations, they are no longer allowed to do that, so they are forced to buy better (for the environment, also maybe features and finishes) second hand cars. It doesn't really feel like a choice driven by the desire for new features, moreso a choice majorly pushed by new safety and emission standards.

IncRnd 5y ago

It's odd that you are even creating these arguments that prices don't increase. Not everyone cares about Price/component cost/feature set/quality. The truth is that the actual real-world cost for what people view as the same item, in this case an iphone, has increased year-over-year. > People don’t mind this because they are ultimately concerned about their overall quality-of-life. Of course people mind paying more and more each year. > nobody wants a new car with no air conditioning, minimal sound deadening, low horsepower, crude construction, and 5 digit odometer reliability. Those portions essentially cost nothing in the overall build cost of a car. Every car has had A/C for years. An odometer, seriously? Again, the truth for buyers is that the cost of a car goes up year over year. If we set your hyperbole to the side, people do purchase entry-level vehicles when they are introduced to the market. Many times the demand outstrips the supply, because of price.

kansface 5y ago

90s era cars aren’t close to meeting current requirements. The new requirements may in fact explain all of the price increases. I imagine there would be a market for a “new 2005” civic at say 7k$, because one exists for the old ones at 2k.

MontyCarloHall 5y ago
New safety and emissions standards are part of it, but don’t explain everything. Engines have gotten more powerful and more efficient, and the extra power isn’t just to keep up with additional weight due to all the new required safety features (which are a good thing, BTW!). Compare 0-60 times and handling between old and new cars. A new Accord Sport does 0-60 in 5.5 seconds, which was firmly in serious sports car territory in the 90s, and was borderline supercar territory in the 80s. Materials and fit and finish of new cars are also way better than they used to be. Reliability has greatly improved too over the last few decades, though that’s plateaued somewhat in the last decade or two, likely due to increased complexity. Remember, in the 80s and even into the mid-90s, cars often came with 5 digit odometers because they weren’t expected to last more than 100,000 miles. If there were a robust market for brand new 2005 Civics, automakers would capitalize on it. The Mitsubishi Mirage[0] is the closest thing on the market I can think of to this. It has the feel of an economy car from around 2005, and sells brand new for $14,000, which coincidentally is almost exactly the non-inflation adjusted MSRP of a 2005 Civic. It sells poorly. Most people don’t want to buy a new car that feels like it’s 15 years out of date. [0] https://www.youtube.com/watch?v=5aCsNs3eYTE https://www.youtube.com/watch?v=5aCsNs3eYTE
- ThalesX 5y ago
  In my backwards East European country, most people outside of cities use cars for utility purposes. As such, they keep very old cars, and if they need to change, they buy some second-hand ones from Germany and so on. With the new environmental regulations, they are no longer allowed to do that, so they are forced to buy better (for the environment, also maybe features and finishes) second hand cars. It doesn't really feel like a choice driven by the desire for new features, moreso a choice majorly pushed by new safety and emission standards.