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Okay, the next one is healthcare costs, which they say have risen by about 50% by their metric since 1972. So, I haven't dug into that, but there I could believe that you might legitimately have the sort of cartel you're worried about. Well, okay, not a cartel, but regulatory capture. A doctor can only practice in a state if the medical board approves, and doctors can influence the standards set by the medical board -- that is, block out competition, something that most industries can't do. Doctors do make pretty high salaries in the US, much higher than in many other countries, and I've read articles before that are pretty critical of the role that the regulatory system places in creating the barriers to entry.

https://www.economist.com/united-states/2023/10/31/why-doctors-in-america-earn-so-much

Why doctors in America earn so much

According to the Association of American Medical Colleges (AAMC), in a decade America will have a shortage of up to 124,000 doctors. This makes no sense. The profession is lavishly paid: $350,000 is the average salary according to a recent paper by Joshua Gottlieb, an economist at the University of Chicago, and colleagues. Lots of people want to train as doctors: over 85,000 people take the medical-college admission test each year, and more than half of all medical-school applicants are rejected. And yet there is a shortage of doctors. What is going on?

Yet there is another explanation for the doctor shortage, which has to do with the pipeline into the profession, and which the American Medical Association has played a part in creating. It takes longer to train a doctor in America than in most rich countries, and many give up along the way. Future physicians must first graduate from university, which typically takes four years. Then they must attend medical school for another four years. (In most other rich countries, doctors need around six years of schooling.) After post-secondary education, American doctors must complete a residency programme, which can last from three to seven years. Further specialist training may follow. In all, it takes 10-15 years after arriving at university to become a doctor in America.

If the expense and length of the training were not off-putting enough, the number of places in the profession has also been artificially held down. In September 1980 the Department of Health and Human Services released a report warning of a troubling surplus of 70,000 physicians by 1990 in most specialties. It recommended reducing the numbers entering medical school and suggested that foreign medical-school graduates be restricted from entering the country. Despite the shortage, doctors trained abroad must still sit exams and complete a residency in most states regardless of their years of experience.

Medical colleges listened, and matriculation flatlined for 25 years, despite applications rising and the population growing by 70m over the same period (see chart). In 1997 federal funding for residencies was capped, forcing hospitals to either limit programmes or shoulder some of the financial burden of training their doctors. Some spots have been added back, but not nearly enough. Many potential doctors are being shut out of the profession. “Not everyone who would be willing to go through that training and could do it successfully is being allowed to,” says Professor Gottlieb, the economist.

Nurse practitioners and physician assistants have been given responsibilities typically reserved for doctors, such as writing prescriptions. Foreign-trained doctors have filled some of the gap too. Yet the shortage persists. This looks a lot like a labour market that has been rigged in favour of the insiders.

So I'll grant that in that case, we may legitimately have a non-competitive market producing an increase in prices.

Next one is the price of a car.

1972: $26,100

2022: $48,200

So, I think that there are a couple factors that you can look at here. The first -- and here, the article specifically talks about it -- is that this isn't a like-for-like comparison, kind of like what I mentioned with housing. If people want to spend more on a car, that can mean that there are more people buying fancy, luxury cars, not that the car has become unaffordable. They do mention the Corolla as a baseline, which is more-or-less what I would have done, and adjusted for inflation. They do say that it's about 30% higher, but also point out that the 1972 vehicle is not really equivalent to the 2022 vehicle, as the 2022 vehicle has a lot more hardware and features.

They don't mention it, but I'd also point out that they were measuring this in 2022; during the COVID-19 crisis, there was a severe shortage of chips to automakers, which dramatically constrained supply and idled a lot of production, and while I wasn't paying attention to the prices of new cars, I assume that they spiked then. I do know that the price of used cars spiked as a result.

So, I won't run the numbers there, but I think that I'd want a stronger argument with some numbers for a cartel, if that's the concern. I'll grant that automakers are few enough that I could legitimately believe creation of a cartel (and you can definitely point at cases where cartel behavior has shown up, as with Dieselgate in the European Union, where automakers colluded not to offer large urea tanks).

Oh, and it looks like I counted incorrectly -- there's a fifth one:

Vacation (admission to Disney World) 1972: $1,170 for a three-night/four-day stay at Disney World for two adults and two kids 2022: $2,670 for the same

Ehhh. Okay. This is not something that I've looked at before, but I'm not sure that Disney World -- a single business -- is representative of vacationing in general. I've watched video from Disney World, and my vague impression is that Disney World, at least today, is somewhat-upscale. They didn't have all the resorts and stuff that they have today.

googles

Yeah, it sounds like they're offering a more-elaborate experience than in the 1970s:

https://mickeyblog.com/2021/02/05/looking-back-at-walt-disney-world-during-the-1970s-part-ii/

As a reminder, it only consisted of one theme park, one mediocre water park, Discovery Island, and an outlet mall at the time [1979].

I'd think that maybe something like...hmm...airfare plus hotel fees plus restaurant meal costs at popular vacation spots might be a better metric, maybe?

Yet we know that people are over 3x as productive per person over the same period, so clearly companies are not passing along savings in the form of cheaper goods.

So, you're thinking "well, if productivity rose, labor costs are an input, and there's a competitive market, then we would expect to see price drops"?

Well, some things have also dropped; I mean, you're looking at a list of things that's cherry-picked to find increases. A personal computer, a flight on an airplane. I'd guess that energy prices are probably down since the 1970s:

googles

Yeah, in inflation-adjusted terms:

https://www.usinflationcalculator.com/inflation/electricity-prices-adjusted-for-inflation/

Productivity increases aren't evenly spread across all sectors. You wouldn't expect to see a productivity increase in one field directly translate into a price decrease, even in a competitive market, in another.

Let's see if we can find something talking about productivity on a sector basis.

https://www.mckinsey.com/mgi/our-research/rekindling-us-productivity-for-a-new-era

So, this has a graph measuring 2005-2019 productivity growth by sector. The worst-ranked sector was construction, where productivity dropped at a compound annual growth rate of -0.9%. In information technology, productivity rose at a compound annual growth rate of 5.5%.

And to just grab those two as an example, I think that that's probably not wildly out-of-line with what we've seen. Housing prices have risen a bit, based on the data I covered in my parent comment. Software's generally cheaper than it has been in the past.

The author claims that there's a fair bit of correlation with the degree to which a given sector was impacted by the advent of computers. I could believe that; Moore's Law dictated that, for much of the 20th century, we saw exponential growth in transistor density, and any field that could benefit from more computing power had a factor that was exponential affecting it. That tailed off in about 2003, though, and performance improvements in computing since then have in significant part been in parallel computation, which isn't exactly a drop-in improvement for everything the way serial computation is.

Inelastic demand for necessary products like fuel, utilities, food, health care, etc also means that in many industries increased productivity does not need to translate to savings.

Inelastic demand for something (and I assume that you're not talking about the labor market, as I was, but rather what the industry produces) doesn't entail that an increase in productivity doesn't cause the price to drop. It'll mean that as the price falls, no more of the thing is sold, but as long as the market is competitive, one would expect to see a price fall off.

I'll continue in the child comment.