Long Run Inflation and Technological Development - Part III
Monday June 29, 2009
I have commented in the past that it is impossible to measure inflation over long-periods of time (see here and here). Inflation "is an increase in the price of a basket of goods and services that is representative of the economy as a whole", but due to technological and taste changes, a representative basket of goods in 1979 is radically different than in 2009 and there is no objective way to compare the two.
It is an obvious point, but I think it is one economists all too often forget. That's why I was delighted to see the article Giving up my iPod for a Walkman:
It is an obvious point, but I think it is one economists all too often forget. That's why I was delighted to see the article Giving up my iPod for a Walkman:
When the Sony Walkman was launched, 30 years ago this week, it started a revolution in portable music. But how does it compare with its digital successors? The Magazine invited 13-year-old Scott Campbell to swap his iPod for a Walkman for a week.Note that the "cannot measure inflation over long periods" argument does not claim the current goods are necessarily better. Just that they are different. Bring back the World Hockey Association!
Comments
Mike,
The article you refer to, “Giving up my iPod for a Walkman” does not once mention that other excellent, wonderful, enduring technology, the radio, with its wide range of possible entertainment, which is also a part of the Walkman.
Nor did any of those who made comments on this article mention radio. Perhaps they have never heard of radio; after all it is much older technology.
Regards,
Alwyn
sir,
when ever you write about any article, please write its comtemporary position and views against it.
thanking sir
Thank you for finally explaining that so well. This is just one more reminder that the only real way to keep our economy strong is not by raising taxes, but by keeping taxes low, fair and simple. I’ve been looking for a way to take action and contact our legislators and sign petitions and found some good policy the U.S. Chamber of Commerce backs (here). I don’t have a lot of money or time, but I figure this will help other people do good.
“A representative basket of goods in 1979 is radically different than in 2009 and there is no objective way to compare the two.”
Oh, well, definitely. I know that those new cyber-apples revolutionized the way I think about lunch.