Fifty Years of Economic History in one Figure

by on November 5, 2009 at 6:51 am in Data Source, Economics | Permalink

David Beckworth sums up a lot of recent economic history in one figure.

Spending history

A few thoughts:  I wish Arnold Kling were correct that inflation is around the corner.  We could use some inflation to get back on track.  Nominal wages are simply not flexible enough to get the job done in short order and there is much to fear from populist backlash.

See also the link above for a remarkably similar figure for the OECD which illustrates the US's role of monetary hegemon. 

19 comments

not_scottbot November 5, 2009 at 7:01 am

‘We could use some inflation to get back on track.’

Irving Fisher on the phone, prof. Tabarrok. And I think his call took less than 49 seconds to place, by the way.

Ironman November 5, 2009 at 8:03 am

The U.S.’ demographics don’t as yet support a return to inflation (assuming that there is a demographic component to spending that affects its rate.)

stinkaroo November 5, 2009 at 8:36 am

I don’t have hard numbers, but I feel that we could help defeat deflation by lifting immigration barriers and restrictions. Wouldn’t that be the most painless way?

spencer November 5, 2009 at 9:11 am

the scales are the same. I do not see your problem.

Tim November 5, 2009 at 9:46 am

I think we’re experiencing inflation right now….asset price inflation. I agree though that we could use a little inflation in goods prices/wages.

Gabe November 5, 2009 at 10:50 am

how does inflating the money supply improve our mix of productive capital? And how does price inflation of goods improve our standard of living?…when food prices, health care and tuitions rise it decreases my standard of living. Of course silver gold and oil price increases are good for me because I am betting that the dollar will continue on it’s path to 3rd world status. Too many spineless idiots running this country and the Fed.

spencer November 5, 2009 at 12:07 pm

You should compare this to my chart of Labor’s Share of nominal output in my post on productivity at Angry Bear.

http://angrybear.blogspot.com/

anon November 5, 2009 at 3:31 pm

Free exchange elaborates

http://www.economist.com/blogs/freeexchange/2009/11/fifty_years_of_nominal_spendin.cfm

Randall Parker November 5, 2009 at 9:46 pm

A larger fraction of total economic output is flowing to a smaller fraction of the populace and this smaller fraction is more inclined to save, not spend. This means more asset inflation and less consumer price inflation when monetary policy is expansionist.

Go Horns! November 5, 2009 at 10:24 pm

Why would it be bad if we ended up at 0% nominal growth on spending for a while?

Rick Caird November 6, 2009 at 6:06 pm

If you were on a fixed income, I doubt you would welcome inflation. I seem to remember the 70′s found inflation to be a problem.

Rick

Matthew November 7, 2009 at 7:20 am

Housing prices are rising because the zombie banks (and now the FedGov via Fannie, Freddie and FHA) are sitting on a nearly infinite amount of shadow inventory, not letting it hit the market, the no-money-down / bad credit mortgage is back (thanks to the Fed), and non-payment of mortgage means a free place to live for 12-24+ months instead of nonpayment of rent which gets you evicted in 30-60 days.

AVeryRoughRoadAhead November 8, 2009 at 4:32 pm

“Would the larger proportional growth in available workforce in the 1970′s account for a chunk of the 1970′s spending spree?”

Yes.

Further, if we adjusted the graph to reflect per capita spending, then that plunging line at the end would have to be extended downward.

wedding dresses uk February 3, 2010 at 4:20 am

Welcome to my site, thank you.

理想を貫く強 March 10, 2010 at 9:31 am

lcz
「自分自身を発見し、理想を貫く強い意志を持つこと」。new balance1918年、ボストンに小さな店をオープンしたティンバーランドの創業者airmax 95 、ネイサン・シュワーツが残したシンプルな企業理念は、アメリカのみならず、ティンバーランドのその名が世界的に知られるまでになった現在でも、経営陣から社員一人ひとりにまで浸透していますtimberland ブーツ。

となり日本を沸 March 10, 2010 at 11:27 am

lxq
どのジャージにおいても、タテに走るネイビー色のラインは生地に直接染めてありますNIKE ジャージ。
レプリカジャージはナイロンメッシュ生地です。NIKE ジャージほぼ同じ倍率にも関わらず、メッシュ穴の大きさが他の２つに比べて、小さく非常にきめ細かに入っていることがわかります。またナイロン独特のテカつきがあるのも特徴ですNIKE ジャージ。
一方、スウィングマンジャージはポリエステルメッシュ生地で出来ていますNFLジャージ。レプリカジャージよりもメッシュ穴が大きく、目を凝らすと生地の織り目まで見えます。オーセンティックジャージ（≒実使用）にも同じ生地素材を採用してい用いるチームが多いため、より選手が着用する実使用の物に近い仕様になっております。また、手触りはレプリカジャージと異なり、reebok ジャージザラザラしているのも特徴です。
オーセンティックジャージは、reebok ジャージ同じチームでもホーム・アウェイ・３ｒｄ（現オルタネート）の種類ごとに生地の素材が異なる場合が多く、レイカーズ ジャージ今回は偶然にも、スウィングマンジャージの生地素材と同じでした。見た目はほとんど変わりませんが、オーセンティックジャージの方がメッシュ穴がきめ細かに入っています。また、触った感じではオーセンティックジャージの方が厚手に感じられます。

knitting patterns August 27, 2010 at 4:45 am

I hope I will soon be able to own some http://www.knitthelife.com Crochet Pattern Central .HeidelBerg Parts http://www.gzqiyue88.com Man Roland Parts

Digital Photo Frame October 18, 2010 at 5:58 am

Digital photo frames are common in 7 inch (17.8 cm) to 20 inch (50.8 cm) sizes. Some digital photo frames can only display JPEG pictures.Digital Photo Frame Most digital photo frames display the photos as a slideshow and usually with an adjustable time interval. They may also be able send photos to a printer. Hiphone Digital photo frames typically display the pictures directly from a camera’s memory card, though certain frames also provide internal memory storage. Some allow users to upload pictures to the frame’s memory via a USB connection,USB Flash Disk wirelessly via bluetooth technology. Few are able to send photos with cellular connectivity. Some frames allow photos to be shared from a frame to another.

power balance wholesale December 29, 2010 at 6:45 am

I would worry more about commodity inflation with the following bad scenario: commodity prices increase worldwide, Chinese manufacturers absorb the commodity inflation and do not raise power balance wristbands prices, and US domestic manufacturers, unable to raise prices, go out of business.

Comments on this entry are closed.

Previous post:

Next post: