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The text said Innovation drives inflation up! So funny! Actually Innovation drives inflation down: Think when we need to send a letter and now we just send a te
by dellIsBetter 4y ago
The text said Innovation drives inflation up! So funny! Actually Innovation drives inflation down: Think when we need to send a letter and now we just send a text message, much less resources included!
- acilim 4y agoI think in the shorter term innovation does influence inflation a little bit. Like the article stated, if a product is new and offers some uniqe benefit everybody will want to buy it and that will drive demand up. Like first automobiles, internet, cellphones. Probably not a huge influence but not negligible.
- dellIsBetter 4y agoThe demand of digital cameras is down with new iPhone. Someone buy one new thing and do not on other, this is inflation neutral.
- acilim 4y agoYeah. I was thinking more about some things that are completely new. My examples aren’t the best.
- jeffreygoesto 4y agoYou'd have sent a tiny fraction of the messages you text now. Plus, you must include the hidden cost of all intermediate machines and infrastructure. I am not sure if it could end with a draw...
- dellIsBetter 4y agoOn only one interaction maybe you is correct. But not on 1B interactions.
- yyy888sss 4y agoYep, innovation means prices understate the true level of inflation. Eg: If technology reduces costs by 5% and the CPI measures 2%, then the real rate of inflation is at least 7%.