Our Standard of Living
By David Henderson
Radio Shack has put its catalogs for 1939 to 2005 on line. They’re worth a gander. Choose any date earlier than 10 years ago and you get a feel for just how much our standard of living has increased. The items are generally what we regard as junk–and they’re expensive.
1976-77, pp. 4-5: An AM-FM radio and cassette tape deck for $179.95.
Same page: 8-Track Stereo player. Yes: 8-track. Price: $149.95. BTW, that’s some evidence against the path dependence idea that we get stuck with lower-quality stuff because of first-mover advantages.
1949: pp. 2-3: Amateur transmitter for “only” $1450.00.
1985, pp. 1972-173: MS-DOS computer, $4250.00.
Schumpeter, in Capitalism, Socialism, and Democracy, said:
Queen Elizabeth owned silk stockings. The capitalist achievement does not typically consist in providing more silk stockings for queens but in bringing them within the reach of factory girls in return for steadily decreasing amounts of effort.
What these Radio Shack catalogs show is that Schumpeter dramatically understated the case.
For more about standards of living, see John V.C. Nye, “Standards of Living and Modern Economic Growth,” in the Concise Encyclopedia of Economics and Brad DeLong, “Cornucopia: Increasing Wealth in the 20th Century.”
HT: Mark Carbonaro.