Monday, December 14, 2009

Christmas Shopping for a TV: 1958 vs. 2009

Click to enlarge.

In 1958, American holiday shoppers paid $269.95 for Sears’ “best 24-inch console TV” (Update: black and white) in its 1958 Christmas catalog (see photo above on left), or it would have taken 136.34 hours of work at the average manufacturing hourly wage then of $1.98 to earn enough income (ignoring taxes) to purchase the TV.

Today you can purchase a Sansui 26-inch widescreen LCD high-definition TV (see picture on right) on the Sears website for about $350 (or chose from the several hundred other TVs available), which would be a “time cost” today of only 19.03 hours of work at today's average hourly wage of $18.39, and this represents an 86 percent reduction in the cost compared to the 1958 TV. 

Alternatively, it would be slightly less costly for a holiday shopper to purchase seven 24-inch TV sets today (133.21 hours of work at the average hourly wage) than it would have been for a 1958 holiday shopper to purchase just a single 24-inch TV (136.34 hours of work at the average hourly wage). 

24 Comments:

At 12/14/2009 5:07 PM, Blogger Methinks said...

Take a good look at that 2009 television. If Obama has his way, the comparison of a 2009 and 2050 television will be the same picture.

 
At 12/14/2009 5:19 PM, Anonymous DrTorch said...

Political left response: Yes, but you've left out the high costs of Cable/Satellite TV.

Today's poor and middle class struggle to pay for these necessities.

 
At 12/14/2009 5:27 PM, Anonymous Lyle said...

Mark you may want to note that the set you show is Black and White.
The big change from 58 is that it is black and white in 1958 (the only color sets were 21 inch round screen at the time, This site suggests about $750 http://www.vintagetvsets.com/ctc7.htm or about 378 hours). If you notice the sides of the screen on the 1958 tv are curved, and of course the cabinet is deep and the set weighed over 300 lbs, and drew 380 watts because it had 28 heaters (tubes) in it.
Other than being thinner and lighter weight and more display based goodies (none of which shows on the picture) and maybe a satellite receiver built in because wireless has taken broadcast tv off the air what would you expect to see? The form factor has about completed its evolution flat black and thin.

 
At 12/14/2009 6:29 PM, Anonymous Benny The Man said...

It gets even better: Anybody with some effort and wits can buy used electronic equipment on Craigslist--usually at half-price or less, from somebody moving out of town.

Oddly enough, my wife is not appreciative of the used goods I have bought for her X-mases and anniversaries, birthdays etc.

 
At 12/14/2009 7:30 PM, Anonymous Benny said...

The set in 1958 is what you could buy in a Republican Administration.
The set in 2009 is available Obama's Administration.
Ergo, Democrats are better rulers than Republicans.

 
At 12/14/2009 8:04 PM, Anonymous gettingrational said...

The cost of television watching to high becuause of cable bills? Get back to those days of 1958 with no antenna and No Cable necessary!

 
At 12/14/2009 8:53 PM, Anonymous Rand said...

Hey Benny:

In 1958 doctors made house calls and health care was affordable. So I guess that Eisenhower was the better President.

 
At 12/14/2009 8:56 PM, Anonymous Rand said...

In 1958 the TV set was made in the United States by American workers. The 2009 TV set was probably made in China. Eisenhower wins again.

 
At 12/14/2009 10:36 PM, Anonymous Jeffrey Ellis said...

Heh. You so swiped this post idea from Steve Horwitz. (Not that he'd mind!)

 
At 12/15/2009 1:09 AM, Anonymous Dish Network Deals said...

It becomes still enhanced. Any person with some attempt and intelligence can buy second-hand electronic equipment on Craigslist- generally at half-price or even less, from someone moving out of city.

 
At 12/15/2009 6:06 AM, Anonymous Anonymous said...

Talcalyz claims moral superiority by making a snide, douche bag comment. Real clever there Talcalyz. What a pin head.

 
At 12/15/2009 7:50 AM, Blogger Mark J. Perry said...

Jeffrey Ellis: I have been featuring this type of analysis for about about a year now, see this CD post from January 2009, and many more followed that one!

 
At 12/15/2009 8:08 AM, Blogger Steven Horwitz said...

Mark, I think what Jeff, who is a friend of mine, was referring to was this specific NBR blog entry of mine: http://www.pbs.org/nbr/blog/2009/12/the_miracle_of_the_market.html which dealt with TVs from 85 to the present.

Jeff: Mark is not only also a GMU grad but a friend as well, and he's quite right to say that he (and Don Boudreaux) have been doing this for awhile, as have I. Us free market economists like to share!

 
At 12/15/2009 8:32 AM, Anonymous niknaknoo said...

There's a simple reason why this is, back in the 50s the TV sets were made in America. Now they are made in China.

And I'm sure you can see the price you are paying, as your economy is pretty much screwed because you don't produce stuff anymore.

Enjoy the cheap goods while they last!

 
At 12/15/2009 8:34 AM, Anonymous niknak said...

(That's if you are lucky enough to have an income)

 
At 12/15/2009 8:45 AM, Blogger OBloodyHell said...

> Oddly enough, my wife is not appreciative of the used goods I have bought for her X-mases and anniversaries, birthdays etc.

Benny, power tools are not typically thought of as good gifts, used or unused.

Badum-bump.

 
At 12/15/2009 8:53 AM, Blogger OBloodyHell said...

> In 1958 the TV set was made in the United States by American workers. The 2009 TV set was probably made in China.

...While American workers made far more wealth producing IP.

Inflation calculator:

What cost $1.98 in 1958 would cost $14.58 in 2008.

So at an average wage of 18.39 they're making more money per hour of work, doing work which is far less likely to be physically taxing, under conditions (an air-conditioned office vs. a factory floor) which are far safer, healthier, and more comfortable -- all while it takes them far fewer hours of work to buy just about every single thing they buy, as Mark has noted before -- food, clothing, shelter, transportation...

So your point is...?

 
At 12/15/2009 9:00 AM, Blogger OBloodyHell said...

That goes for your brilliance, too, niknak.

"If you're lucky enough to have an income"

Well, since the solution has been known for decades -- cut taxes -- and the dems just refuse to ack this and do it, even though it's blatantly working in some of the other nations also hit by this crisis, it's not really a matter of luck.

All idiocies like TARP do is rearranging deck chairs on the Titanic. "Take money away from Joe, give it to Paul, less our 'government handling fee' of 35% or more".

Since this is what private credit already does for a far lower fee, it's no surprise that cutting taxes stimulates the economy better, and the tax base still manages to go UP.

CLUE < -- get one, they are utterly FREE.

 
At 12/15/2009 9:46 AM, Blogger Colin said...

I wonder who can better achieve cost savings in health care: the free market which gave us the ever cheaper and improved television or the public sector which pays $50 million for a traffic monitoring system which doesn't work (just one example of many):

http://www.governmentfiasco.com/2009/12/traffic-problems.html

 
At 12/15/2009 9:59 AM, Anonymous Jeffrey Ellis said...

Yes, I was just commenting on the coincidence of the similar posts -- didn't mean for it to sound accusatory Mark, and sorry if it did!

 
At 12/15/2009 11:46 AM, Blogger QT said...

OBloodyHell,

So at an average wage of 18.39 they're making more money per hour of work, doing work which is far less likely to be physically taxing, under conditions (an air-conditioned office vs. a factory floor) which are far safer, healthier, and more comfortable -- all while it takes them far fewer hours of work to buy just about every single thing they buy, as Mark has noted before -- food, clothing, shelter, transportation...

Well argued.

Looks like the research is also showing that tax cuts work better than Keynesian spending at generating economic recovery

 
At 12/15/2009 1:04 PM, Anonymous Benny The Man said...

OBloodyHell-

I think an Oliver sliding table saw is a great birthday gift. They don't make that heavy iron anymore.

 
At 12/15/2009 1:54 PM, Anonymous niknak said...

In response to "Oh bloody hell" cutting taxes would be a great idea, but can the government afford to do that? Is it an option?

With the national debt at $12 trillion and growing the only way taxes are going to go is up.

 
At 12/17/2009 3:45 PM, Anonymous Anonymous said...

Okay let’s consider different time frames and an average product in the Consumer Price Index rather than a specific product. Today, in 1982 inflation adjusted dollars, Americans earn about $282 a week. In 1947 it was $196 and in 1973 it was $315. 1947 was selected because it is the oldest data not heavily influenced of the War or the Depression. 1973 was selected because it was the year American real wages set an all time high from which they have descended. Now consider the basket of goods and services used to calculate the Consumer Price Index for each year. From 1947 until 1973 the number of man-hours needed to purchase the average product in the basket declined about 37 percent. In other words from 1947 until 1973 real wages rose faster than prices. From 1973 until today it is a different story. From 1973 to today the man-hours needed to buy the average product in the basket INCREASED about 10 percent. Real (inflation adjusted) wages have declined faster than prices leaving the vast majority of American worse off.


I would blame that on free trade. Over the years I have encountered about a dozen explanations for the decline in real wages other than free trade. They all fall short for one of two reasons. First they are the result of falling wages not the cause of it. For example, a declining savings rate is often offered. When jobs are outsourced, laid off workers try to maintain their standard of living. First they quit adding to savings, then spend past savings, then borrow, then face reality.


The second, and most common, reason to reject a not free trade explanation is that it describes a circumstance that is not unique. A 36 year decline in real wages is unique. It never happened before. Real wages rose in the decade of the 1930s in spite of the Great Depression. As an example of this, Robert Reich has recently offered the explication that factory jobs are going away not because of outsourcing but because of increases in productivity. That is not unique. That has been happening since before George Washington started buying gunpowder. If that were the cause why did the problem not happen a hundred years ago?


Again I blame free trade. I point out that the US went from a producer of raw materials and agricultural products in 1828 to an industrial power by the end of the century. One of the events of 1828 was Andrew Jackson imposed tariffs which lasted for more than a hundred years. For more than a hundred years the US was the world’s most trade protected nation.

 

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