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Cataloging Improvements in Americans’ Living Standards

Posted By Don Boudreaux On February 5, 2011 @ 5:20 pm In Growth,History,Standard of Living | Comments Disabled

Writing about comments [1] – some from Tyler himself – on Bryan Caplan’s and Arnold Kling’s reactions to Tyler’s new e-book, The Great Stagnation [2], EconLog’s David Henderson says:

I would still like to know Tyler’s answer on choosing between spending a given number of nominal $ on items in the 1973 catalogue vs. spending on items in the 2000 catalogue. Even better would be 1973 vs. 2010.

Of course, I can’t answer for Tyler.  But I can – prompted in part by my vanity – reprise here two posts from January 2006 in which I compare Sears-catalog offerings from 1975 to products available in 2006.

Here’s the first post [3]:

I just made my first purchase using eBay: I bought a Fall/Winter 1975 Sears catalog. (I paid $2.99 for the catalog and $13-something to have it shipped to me by FedEx.)

This catalog was issued at the start of my senior year in high school. I have decent memories of the mid-70s. Perusing this Sears catalog confirms my sense that my recollection of those days is pretty good.

The days themselves, however, were — compared to today — not so good.

Other than the style differences, the fact most noticeable from the contents of this catalog’s 1,491 pages is what the catalog doesn’t contain. The Sears customer in 1975 found no CD players for either home or car; no DVD or VHS players; no cell phones; no televisions with remote controls or flat-screens; no personal computers or video games; no food processors; no digital cameras or camcorders; no spandex clothing; no down comforters (only comforters filled with polyester).

Of course, some of what was available to Sears’ customers in 1975 is also quite noticeable to those of us looking back from 2006: typewriters, turntables for stereo systems, 8-track players, black-and-white television sets.  And lots and lots of clothing and bedding made from polyester.

The lowest-priced electronic calculator available in this catalog set the citizen of 1975 back $13.88 [in 2011 dollars, that's $56.91] – it had a whooping six digits of display and could add, subtract, multiply, and divide.

Also available were microwave ovens, ranging in price from $189.95 to $439.95.

Of course, there’s been a good deal of dollar inflation since 1975. Judged by changes in the consumer-price index, what $100 bought in 1975 takes about $354 to buy today. So that six-digit calculator would today cost about $49. Sears lowest-priced microwave oven in 1975 would today set you back $672.

Here are some other 1975 products and their 1975 prices (along with their inflation-adjusted 2006 prices):

Sears Best kitchen range, $589.95 ($2,088).

Sears Best television, $749.95 ($2,655)

Sears Best black and white television, $137.95 ($488)

Sears Best typewriter, $278.99 ($988)

Sears Best motion-picture camera (no sound; but it did have 8X zoom!), $197.00 ($697)

Sears lowest-cost telephone answering machine, $99.50 ($352)

Sears highest-priced tent for four adults, $84.88 ($300)

But inflation is difficult to calculate. In a later post, I’ll take a page from the work of Michael Cox and Richard Alm [4] and ask: how many hours did the American production worker have to work in 1975 to buy things from the Sears catalog? And how many hours must the average production worker today work if he were to buy 2006 versions of these things?

And here’s the second post [5]:

I wish I had more time – or that my time weren’t so valuable.  I would spend more time perusing my 1975 Fall/Winter Sears catalog [6].

I checked out a few items from that catalog that are reasonably – though hardly fully – comparable to similar items in 2006. Then, I divided the average hourly nominal earning of production workers in 1975 ($4.87 in December of that year) into the price of each of these (more or less) randomly selected items.  I did the same for 2006 items found (with exceptions noted below) at Sears.com [7], dividing these prices by the average hourly nominal earning of production workers in December 2005 ($16.34).  My data are found in at this BLS site [8].

My aim – copying the method used by Michael Cox and Richard Alm in part of their 1999 book Myths of Rich & Poor [4] – is to see how many hours this average American production worker must work to purchase each of these items.

Here’s what I found:

Sears’ lowest-priced 10-inch table saw: 52.35 hours of work required in 1975; 7.34 hours of work required in 2006.

Sears’ lowest-priced gasoline-powered lawn mower: 13.14 hours of work required in 1975 (to buy a lawn-mower that cuts a 20-inch swathe); 8.56 hours of work required in 2006 (to buy a lawn-mower that cuts a 22-inch swathe. Sears no longer sells a power mower that cuts a swathe smaller than 22 inches.)

Sears Best freezer: 79 hours of work required in 1975 (to buy a freezer with 22.3 cubic feet of storage capacity); 39.77 hours of work required in 2006 (to buy a freezer with 24.9 cubic feet of storage capacity; this size freezer is the closest size available today to that of Sears Best in 1975.)

Sears Best side-by-side fridge-freezer: 139.62 hours of work required in 1975 (to buy a fridge with 22.1 cubic feet of storage capacity); 79.56 hours of work required in 2006 (to buy a comparable fridge with 22.0 cubic feet of storage capacity.)

Sears’ lowest-priced answering machine: 20.43 hours of work required in 1975; 1.1 hours of work required in 2006.

A ½-horsepower garbage disposer: 20.52 hours of work required in 1975; 4.59 hours of work required in 2006.

Sears lowest-priced garage-door opener: 20.1 hours of work required in 1975 (to buy a ¼-horsepower opener); 8.57 hours of work required in 2006 (to buy a ½-horsepower opener; Sears no longer sells garage-door openers with less than ½-horsepower.)

Sears highest-priced work boots: 11.49 hours of work required in 1975; 8.26 hours of work required in 2006.

One gallon of Sears Best interior latex paint: 2.4 hours of work required in 1975; 1.84 hours of work required in 2006. (Actually, Sears sells no paint on-line, so the price I got for a premium gallon of interior latex paint is from Restoration Hardware.)

Sears Best automobile tire (with specs 165/13, and a treadlife warranty of 40,000 miles: 8.37 hours of work required in 1975; 2.92 hours of work required in 2006 – although, the price here is of a Bridgestone tire that I found at another on-line merchant.  Judging from its website, Sears no longer sells tires with specs 165/13 and a 40,000 mile warranty.

I realize that you can accuse me of bias – perusing the 1975 catalog and choosing those goods whose real prices have fallen most dramatically over the past 30 years. Certainly, a catalog of 1,491 pages has too many goods (and services, such as appliance installation) to count.

I avoided clothing (which is the first half of the catalog) because most of the clothing Sears sold in 1975 was made of polyester, or polyester/cotton blends – stuff that few of us wear these days.

And some other goods are simply incomparable across this time span. Take mattresses: Sears does sell today some mattress and box-spring sets that today are comparable to the very best set that it sold in 1975, but Sears top-of-the-line mattresses today are not comparable to its top-of-the-line mattress in 1975.  Likewise with photography equipment and audio-visual equipment: how do you compare a 2006 CD player to a 1975 turntable?

A more fundamental objection to such a practice would go like this: “Sure, prices of things sold in department stores are today much more affordable than they were in 1975, but what about health-care, housing, and education? These things require more hours of work. What does your little catalog exercise really prove about Americans’ overall standard of living?”

It’s a good question – and I believe that I have an answer.  But that answer will await a later blog post (for, unlike Sears, I don’t want anyone to say that this post “has everything!”).

Using the Minnesota Fed’s on-line inflation-adjuster [9], I just checked some of the price-adjustments (from 1975 to 2006) that I reported above: the 2006-equivalent prices that I report above appear to be underestimates.  For example, I wrote in 2006 that Sears Best television – which cost $749.95 in 1975 dollars – in 2006 dollars cost $2,655.  But doing the calculation today I find that the Minnesota Fed’s calculator says that $749.95 in 1975 is the equivalent, in 2006 dollars, of $2,807.96.

Go figure.

I think I used the Minnesota Fed’s on-line inflation adjuster back when I wrote those posts in 2006, but my memory might be faulty.  Whatever.  The point is that many goods for sale in the 1975 Sears catalog were wicked pricey by today’s standards.

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Article printed from Cafe Hayek: http://cafehayek.com

URL to article: http://cafehayek.com/2011/02/cataloging-improvements-in-americans-living-standards.html

URLs in this post:

[1] Writing about comments: http://econlog.econlib.org/archives/2011/02/tyler_cowen_ver.html

[2] The Great Stagnation: http://www.amazon.com/Great-Stagnation-Low-Hanging-Eventually-ebook/dp/B004H0M8QS

[3] the first post: http://cafehayek.com/2006/01/a_1975_sears_ca.html

[4] the work of Michael Cox and Richard Alm: http://www.amazon.com/gp/product/0465047831/sr=1-1/qid=1138306421/ref=pd_bbs_1/104-4956841-8918323?%5Fencoding=UTF8

[5] here’s the second post: http://cafehayek.com/2006/01/working_for_sea.html

[6] my 1975 Fall/Winter Sears catalog: http://cafehayek.com../../2006/01/a_1975_sears_ca.html

[7] Sears.com: http://www.sears.com/sr/javasr/home.do?BV_UseBVCookie=Yes&vertical=SEARS

[8] at this BLS site: http://data.bls.gov/PDQ/servlet/SurveyOutputServlet

[9] Minnesota Fed’s on-line inflation-adjuster: http://www.minneapolisfed.org/


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