American Living Standards, 1888-1994: Evidence from Consumer Expenditures

31 Pages Posted: 16 May 2000 Last revised: 29 May 2022

See all articles by Dora L. Costa

Dora L. Costa

University of California, Los Angeles (UCLA) - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: April 2000

Abstract

I use micro data on food and recreation expenditures from 1888 to 1994 to provide the first estimates of overall CPI bias prior to the 1970s and new estimates of bias since the 1970s and to reassess long-run growth rates. I find that CPI bias was -0.1 percentage points per year between 1888 and 1919 and rose to 0.7 percentage points per year between 1919 and 1935. CPI bias was low in the 1950s and 0.3 percentage points per year in the 1960s and then rose to 2.7 percentage points per year between 1973 and 1982 before falling to 0.6 percentage points per year between 1983 and 1994. Inadequately accounting for the introduction of new consumer goods probably was the biggest source of bias between 1919 and 1935. Revised growth rates suggest that despite the Great Depression real per capita personal income was not falling but was rising by 0.5 percentage points per year between 1919 and 1935 and that growth rates were not stagnant in the 1970s but were almost as high as in the 1960s (4.0 and 3.2 in the 1960s and 1970s, respectively).

Suggested Citation

Costa, Dora L., American Living Standards, 1888-1994: Evidence from Consumer Expenditures (April 2000). NBER Working Paper No. w7650, Available at SSRN: https://ssrn.com/abstract=228124

Dora L. Costa (Contact Author)

University of California, Los Angeles (UCLA) - Department of Economics ( email )

Box 951477
Los Angeles, CA 90095-1477
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
54
Abstract Views
1,546
Rank
676,215
PlumX Metrics