19-Inch TV: 71.3 Hours in 1981 vs. 9.2 Hours Today
Cost of a Sears 19-inch portable TV in 1981: $529.88, or 71.3 hours of work (9 days) at the average hourly wage of $7.42 (total private industries).
Cost of a Sears 20-inch TV in 2009: $169 or 9.2 hours of work at today's average hourly wage of $18.36.
Bottom Line: If we paid the same price today as in 1981 (71.3 hours, at the average hourly wage of $18.36), the 2009 Sears TV above would cost us more than $1,300. Or equivalently, consumers in 1981 actually paid the equivalent of $1,300 in today's dollars for a 19-inch TV. Or we could say that the typical consumer today would earn enough money in about one day (9.2 hours) to earn enough money to purchase a brand new 19-inch TV, whereas the typical consumer in 1981 had to work full-time for almost two weeks to earn enough money to purchase an equivalent TV then.
7 Comments:
1981 TV should be compared to today's LCD/plasma TV.
(same as horse and buggy from 1920 would be compared to Hyundai car today.)
Comparing the 1981 TV to a LCD/Plasma doesn't change the story, just the numbers. You can find 19-inch LCD's for as low as $249 today (http://www.sears.com/shc/s/p_10153_12605_05771208000P)
Plus, comparing the 1981 TV to an LCD/plasma today misses the other half of this story: even if the prices were the same in real terms, the improvements in the quality of the product are remarkable.
(sorry for the back-to-back comments; I'm a little sloppy today)
same as horse and buggy from 1920 would be compared to Hyundai car today.
Hyundai doesn't make cars, it just makes underpowered ripoffs of other brands.
As for the TV and other examples:
How about showing where quality hasn't declined to knockoff levels? Every example seems to have only more/refined features but lower quality.
Just the remote added $80 to the price of the set. That's impressive!
skh.pcola
eh, but was a 20" tv at the high end of the spectrum in terms of size, or even a proportional share of available tvs?
Also, is the product life of tvs on offer today similar to those of 1981? What is the cost of repair insurance?
I suspect that a 20" tv in 1981 is similar to a 42" LCD tv today, would last maybe four times as long, and for which there would be little to no need for repair insurance, but which itself would also cost less, even accounting for inflation, and the contract terms for which would have written in such a way as the consumer would understand how he was actually covered.
All that I see here is increases in productivity and efficiency. It also signifies the large increase in competition for tv manufacturers. The reason we pay less today is a combination of improved processes to make tv's more efficiently, increased competition in the market which drives down prices, and the fact that tv's have less of a "wow" factor today for consumers.
Its just like comparing how much microwave ovens cost (in terms of hours worked). When they were first introduced, they were more expensive than today. For the reasons I mentioned above, the price of microwaves have gone down largely since their inception.
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