by Dr. Robert Luebke
Senior Fellow, Center for Effective Education, John Locke Foundation
Anyone who has been in a store in the past year can’t help but notice steadily rising prices. .The truth is, prices are always changing.
What do price changes look like over time? That’s’ exactly the question . economist Mark Perry tried to answer in a recent post published on his blog Carpe Diem.
The chart below is from Perry’s post. It details price changes from January 2000 to December 2021.
A quick look produces some interesting observations. First, industries that have experienced significant price declines (e.g., cellphones, computer Software, and TVs) are industries with less government regulation, frequent innovation and where competition — especially foreign competition — is real, and strong.
Those industries with significant price hikes — hospitals, colleges, Medical Care — are industries with less competition, strong government regulation and little innovation.
No, I don’t like the price hikes, but no real surprises here.