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“The average new car in the US lasts like 2x longer than it did in 1998. Shouldn’t that factor in?” Absolutely not. Where do you stop with this game? Do you fa

“The average new car in the US lasts like 2x longer than it did in 1998. Shouldn’t that factor in?” Absolutely not. Where do you stop with this game? Do you factor in that the seats are better so people go less to the doctor for back pain?

thfuran 4y ago
Yes, that sounds like a good idea if what you're trying to estimate is the cost of maintaining a certain quality of life.
- spaetzleesser 4y ago
  If you push this far enough then you can argue inflation away from almost anything.
  - thfuran 4y ago
    So what? The goal of measuring inflation isn't to compute the biggest, scariest number, it's to track changes over time.
RC_ITR 4y ago
“I pay $30k for something I have to buy once every 10 years and that is ‘inflation’ vs. paying $20k for something I have to buy every 5 years” I mean, I really struggle to follow your logic. If a paper towel roll has 2x the sheets but costs 1.5x more, is that inflation too?
- spaetzleesser 4y ago
  A lot of people buy a car every n years. For them it doesn’t matter if it lasts longer. How do you quantify how much longer cars last? Maybe people use them longer because cars are better or maybe they use them longer because they can’t afford new cars. The paper towel is a bad example because you clearly can quantify the number of sheets. It gets more tricky if you say new paper towels are more absorbent so you need less so there is no inflation although the sheet costs more. How do you measure that? These metrics are way too easy to be gamed. Next is apples costing twice as much but they are crunchier so no inflation?
  - RC_ITR 4y ago
    > A lot of people buy a car every n years. For them it doesn’t matter if it lasts longer. You can’t just keep randomly changing the relevant populations. First it was working people who can’t afford a breakdown. Now it’s wealthy people who choose to buy cars regularly. Maybe that’s why it’s difficult to grasp inflation: it’s a basket of everybody > How do you quantify how much longer cars last? https://ihsmarkit.com/research-analysis/average-age-of-vehicles-in-the-us-increases-to-122-years.html https://ihsmarkit.com/research-analysis/average-age-of-vehic... > Maybe people use them longer because cars are better or maybe they use them longer because they can’t afford new cars. You’re implying that people used to junk old cars because new ones were so cheap? Interesting take. > The paper towel is a bad example because you clearly can quantify the number of sheets I can also literally quantify how much longer cars last (see link above). > It gets more tricky if you say new paper towels are more absorbent so you need less so there is no inflation although the sheet costs more. Yeah, you know inflation takes a basket of spend into account, right? So yeah if in a year, the average consumer buys half as many paper towels that cost 2x as much that is exactly “no inflation”. > These metrics are way too easy to be gamed. Next is apples costing twice as much but they are crunchier so no inflation? I really suggest you read up more on the thinking behind inflation if you’re going to have such a strong opinion about it. Apples being crunchier is not accounted for in hedonic adjustments [0]. Like literally. Go to FK011 [0] https://www.bls.gov/cpi/quality-adjustment/home.htm https://www.bls.gov/cpi/quality-adjustment/home.htm EDIT: Learn something new I guess. Cars aren’t even subject to hedonic adjustment. They have their own adjustment system that seems pretty fair if you read it[1] [1] https://www.bls.gov/cpi/quality-adjustment/new-vehicles.pdf https://www.bls.gov/cpi/quality-adjustment/new-vehicles.pdf
- lend000 4y ago
  I think the original poster's claim of lasting twice as long is a big exaggeration, but it'd be interesting to see a source. Regardless, cars are likely more expensive to maintain now with all of the added complexity / sensors that can break (remember when everyone could work on their own car? I bet they didn't factor that negative into hedonic adjustments.)
  - RC_ITR 4y ago
    Surprisingly only a little! The USDOT tracks this! That’s why cars are such a bad example. In 1998, the average age of a car on the road was 8.8 years. [0] In 2022 it’s 13 years. [1] Factor in install-base effects and the multiple probably rounds to 2x [0] https://www.bts.gov/content/average-age-automobiles-and-trucks-operation-united-states https://www.bts.gov/content/average-age-automobiles-and-truc... [1] https://www.carscoops.com/wp-content/uploads/2022/05/SP-Global-Average-Vehicle-Age-2022.jpg https://www.carscoops.com/wp-content/uploads/2022/05/SP-Glob...
    - lend000 4y ago
      That's actually a pretty big difference compared to the OP's claim, AND note that this statistic incorporates a delay (we are comparing 1990 vehicles to 2009 vehicles instead of 1998 to 2020). Granted, we don't know how long 2020 vehicles will last yet. The final caveat being the second point I made about people holding onto their cars longer as inflation rises / changing their preferences, not necessarily because the cars are holding up better.
      - RC_ITR 4y ago
        > The final caveat being the second point I made about people holding onto their cars longer as inflation rises / changing their preferences, not necessarily because the cars are holding up better. I’m sorry but the idea that “we used to junk cars sooner because new cars were cheaper” is a very big stretch to support your bias (much moreso than the concept of hedonic adjustment)
        4y ago

thfuran 4y ago

Yes, that sounds like a good idea if what you're trying to estimate is the cost of maintaining a certain quality of life.

spaetzleesser 4y ago
If you push this far enough then you can argue inflation away from almost anything.
- thfuran 4y ago
  So what? The goal of measuring inflation isn't to compute the biggest, scariest number, it's to track changes over time.

RC_ITR 4y ago

“I pay $30k for something I have to buy once every 10 years and that is ‘inflation’ vs. paying $20k for something I have to buy every 5 years” I mean, I really struggle to follow your logic. If a paper towel roll has 2x the sheets but costs 1.5x more, is that inflation too?

spaetzleesser 4y ago
A lot of people buy a car every n years. For them it doesn’t matter if it lasts longer. How do you quantify how much longer cars last? Maybe people use them longer because cars are better or maybe they use them longer because they can’t afford new cars. The paper towel is a bad example because you clearly can quantify the number of sheets. It gets more tricky if you say new paper towels are more absorbent so you need less so there is no inflation although the sheet costs more. How do you measure that? These metrics are way too easy to be gamed. Next is apples costing twice as much but they are crunchier so no inflation?
- RC_ITR 4y ago
  > A lot of people buy a car every n years. For them it doesn’t matter if it lasts longer. You can’t just keep randomly changing the relevant populations. First it was working people who can’t afford a breakdown. Now it’s wealthy people who choose to buy cars regularly. Maybe that’s why it’s difficult to grasp inflation: it’s a basket of everybody > How do you quantify how much longer cars last? https://ihsmarkit.com/research-analysis/average-age-of-vehicles-in-the-us-increases-to-122-years.html https://ihsmarkit.com/research-analysis/average-age-of-vehic... > Maybe people use them longer because cars are better or maybe they use them longer because they can’t afford new cars. You’re implying that people used to junk old cars because new ones were so cheap? Interesting take. > The paper towel is a bad example because you clearly can quantify the number of sheets I can also literally quantify how much longer cars last (see link above). > It gets more tricky if you say new paper towels are more absorbent so you need less so there is no inflation although the sheet costs more. Yeah, you know inflation takes a basket of spend into account, right? So yeah if in a year, the average consumer buys half as many paper towels that cost 2x as much that is exactly “no inflation”. > These metrics are way too easy to be gamed. Next is apples costing twice as much but they are crunchier so no inflation? I really suggest you read up more on the thinking behind inflation if you’re going to have such a strong opinion about it. Apples being crunchier is not accounted for in hedonic adjustments [0]. Like literally. Go to FK011 [0] https://www.bls.gov/cpi/quality-adjustment/home.htm https://www.bls.gov/cpi/quality-adjustment/home.htm EDIT: Learn something new I guess. Cars aren’t even subject to hedonic adjustment. They have their own adjustment system that seems pretty fair if you read it[1] [1] https://www.bls.gov/cpi/quality-adjustment/new-vehicles.pdf https://www.bls.gov/cpi/quality-adjustment/new-vehicles.pdf
lend000 4y ago
I think the original poster's claim of lasting twice as long is a big exaggeration, but it'd be interesting to see a source. Regardless, cars are likely more expensive to maintain now with all of the added complexity / sensors that can break (remember when everyone could work on their own car? I bet they didn't factor that negative into hedonic adjustments.)
- RC_ITR 4y ago
  Surprisingly only a little! The USDOT tracks this! That’s why cars are such a bad example. In 1998, the average age of a car on the road was 8.8 years. [0] In 2022 it’s 13 years. [1] Factor in install-base effects and the multiple probably rounds to 2x [0] https://www.bts.gov/content/average-age-automobiles-and-trucks-operation-united-states https://www.bts.gov/content/average-age-automobiles-and-truc... [1] https://www.carscoops.com/wp-content/uploads/2022/05/SP-Global-Average-Vehicle-Age-2022.jpg https://www.carscoops.com/wp-content/uploads/2022/05/SP-Glob...
  - lend000 4y ago
    That's actually a pretty big difference compared to the OP's claim, AND note that this statistic incorporates a delay (we are comparing 1990 vehicles to 2009 vehicles instead of 1998 to 2020). Granted, we don't know how long 2020 vehicles will last yet. The final caveat being the second point I made about people holding onto their cars longer as inflation rises / changing their preferences, not necessarily because the cars are holding up better.
    - RC_ITR 4y ago
      > The final caveat being the second point I made about people holding onto their cars longer as inflation rises / changing their preferences, not necessarily because the cars are holding up better. I’m sorry but the idea that “we used to junk cars sooner because new cars were cheaper” is a very big stretch to support your bias (much moreso than the concept of hedonic adjustment)
      - 4y ago