Quote:
Originally Posted by HamsterRage
The price of books is way, way higher today....
|
Yes. That's true of many products, as is the inverse.
The CPI is a very broad measure of a wide variety of goods. Again, since we are looking at a 40-year period, it should not be surprising in the least that Specific Commodity X may be much lower or higher than the CPI.
E.g. all it would take is a big run-up in any of the costs for a 10 year period, and voila, you've outpaced the CPI. Unless your prices have a reason to decline drastically, you'll stay above that CPI 20 more years down the road.
What commodities would you like to examine? Most non-food items have radically changed since 1970. How about coffee: $0.10 in a shop in 1970 ($0.55 in 2009 dollars). Isn't that same cup at least $1, maybe $1.50? Perhaps $2.50 and up at Starbucks?
And on the other side, the price of rice steadily declined for years (e.g. $550/ton in India in the early 70s down to $200 in 2001), and then went through the roof during the 2007/2008 global food crisis. Or, the lowest-end IBM PS/2 in 1987 (8mhz CPU -- whoooie that's fast!) was $2595, or $4836 in 2009 dollars. The highest-end was $10,895, and in 2009 dollars that's $20,304. Even if we completely disregard factors like CPU speed or HD size, a personal computer was significantly more expensive in 1987 than today -- as we might expect, given its rarity in '87 and ubiquity today.
And of course there are issues such as how often the "bucket" of goods used to compile the CPI is updated, how it differs from other indexes that focus on raw goods, or producer's prices, or....
Using the CPI as a yardstick for one specific commodity is like fumigating your whole house just to kill one mosquito.
Quote:
|
Originally Posted by HamsterRage
That's not really a fair comparison.
|
There are almost no "fair" comparisons, when you're looking at 40 years of price changes, especially if you aren't factoring in changes in wages.
Quote:
|
Originally Posted by HamsterRage
I did check for industry averages, and the average price of a car in 1970 was $3,900 or $22,400 in 2010 dollars....
|
I hate to quibble, but....
http://www1.eere.energy.gov/vehicles...t_fotw219.html
In year 2000 dollars, a new car in 1970 = $15k. In 2001, $21k. It hasn't changed much since.
I concur the Mustang is a highly specific example, but a) I don't think I'm that far off, and b) the more general point is that it is downright uncommon for any commodity to peg to the CPI.
Quote:
|
Originally Posted by HamsterRage
Books, on the other hand, haven't improved in any way that I can detect over the years.
|
They are produced faster, the image quality is significantly better (looked at a 70s art book lately?), chain stores barely existed in the 70s, retailers are clambering all over each other to offer free shipping....
It's not the same type of change, but the reality is that almost no non-food commodity has avoided alteration since 1970. (And even food has radically changed, due to subsidies, factory farming, GM, improved yield, globalization....)
Quote:
|
Originally Posted by HamsterRage
For myself, I've always figured that people don't bitch too much about the price of paper books because they know that they will eventually be able to get everything at half the cover price in a used book store, or borrowed from friends (or shared with friends).
|
Wait, people don't bitch about the price of paper books?!? Who knew?
The real salve in that aspect is that the big box retailers are often treating highly popular books as loss leaders and slashing the daylights out of the cover prices just to get bodies in the door. E.g. people think of new hardcovers as costing them $12.50 instead of the $25 cover price.