The other Christmas "miracle". The miracle of capitalism----Christmas shopping 1958 vs. 2012 illustrates the ‘miracle of the marketplace’ which delivers better and cheaper goods

Christmas shopping 1958 vs. 2012 illustrates the ‘miracle of the marketplace’ which delivers better and cheaper goods | AEIdeas

Christmas shopping 1958 vs. 2012 illustrates the ‘miracle of the marketplace’ which delivers better and cheaper goods

This was posted last year on CD, and I haven’t had time to do an update for 2013, but thought I would re-post it again for those who might have missed it last year.

One way to illustrate your good fortune of being a holiday shopper today is to measure the cost of consumer goods by the number of hours it takes working at the average hourly wage to earn enough income to purchase typical consumer products at their retail prices, and then compare the “time cost” of goods from the past to today’s “time cost” for similar items. (Don Boudreaux has been featuring some similar comparisons in a series on Café Hayek titled “Cataloging Our Progress,” which inspired this post.)

For example, the retail price of an automatic Kenmore two-slice toaster advertised in the 1958 Sears Christmas Catalog (available here online, and pictured below on the left) was $12.95, or 6.54 hours of work at the average hourly manufacturing wage of $1.98 in 1958 (wage datahere). Today you can buy a comparable Kenmore two-slice toaster for $25.99, and the “time cost” would be only 1.35 hours of work at the current average hourly wage of $19.19, for a reduction of almost 80 percent since 1958 in the amount of work hours required to earn the income necessary to purchase a standard toaster. Additionally, the Sears website todayfeatures more than 100 different toasters, compared to the Sears catalog in 1958, which only featured a few different models.