CD Player Dropped From Inflation Data, Phonograph Next?

from the neverending-treadmill dept

In the UK, the Office of National Statistics has decided to remove the personal CD player from the basket of goods which make up the RPI, the equivalent of our CPI, a measure of inflation. Nobody buys them anymore, the thinking goes, so the more popular and expensive mp3 player has replaced it. In the US, the Bureau of Labor Statistics, often make similar decisions. But does this make sense? Measures of inflation, when placed against wage measures, are supposed to indicate whether consumers are getting ahead. If prices go up, while wages stagnate, then that's a sign of trouble. Now, the reason that consumers buy mp3 players, and not CD players, is that they're better quality and a better deal. Or, put another way, consumers could still buy a high-quality CD player, and save a lot of cash for later. Either way they benefit. But, inflation data doesn't reflect this, it only notes that mp3 players are more expensive and thus the basket of consumer goods doesn't seem to go down in price. It seems that intellectual property isn't the only area in which the government has failed to adapt to new technology. Economic measurements need to show that consumers benefit from the rapid obsolescence and constant price deflation that marks the high-tech world.

Reader Comments

Subscribe: RSS

View by: Time | Thread

  1. identicon
    RJD, 20 Mar 2006 @ 8:28am

    Inflation data is a joke

    These numbers are pretty much whatever the government wants them to be. The two components that everyone ignores are food and gas (those things you really need to live and work) .. the two things that can't be manipulated. This leaves the 'core' inflation rate where the government can move items in and out at's in own discretion. They often replace an item (say detergent - Tide) with a cheaper brand of detergent (Say wal-mart's sunshine brand) to keep the rate 'tame'. The reason given that consumers will gravitate toward lower prices as long as they are available. While they may or may not be true, it masks the fact that prices are going up on products.

    So they moved the MP3 player in ... they probably moved something out of equal or close to equal value.

    Don't know about the rest of you folks, but my cost of living is going up beyond the annual 3.6% rate of inflation.

Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here

Subscribe to the Techdirt Daily newsletter

Comment Options:

  • Use markdown for basic formatting. (HTML is not supported.)
  • Remember name/email/url (set a cookie)

Follow Techdirt
Techdirt Gear
Shop Now: Techdirt Logo Gear
Report this ad  |  Hide Techdirt ads
Essential Reading
Techdirt Deals
Report this ad  |  Hide Techdirt ads
Techdirt Insider Chat
Report this ad  |  Hide Techdirt ads
Recent Stories
Report this ad  |  Hide Techdirt ads


Email This

This feature is only available to registered users. Register or sign in to use it.