Chart of the Week

Prices Are Skyrocketing, But Only For Things You Actually Need

Published

7 years ago

October 28, 2016

Jeff Desjardins

Chart: Prices Are Skyrocketing, But Only For Things You Actually Need

Prices Skyrocketing, But Only For Things You Actually Need

Everything else has fallen in price over the years

The Chart of the Week is a weekly Visual Capitalist feature on Fridays.

The way that economic data is presented, we often think of inflation as a singular number representing a general increase in prices.

For example, it might be reported that nominal GDP growth was 3%, and that inflation was 2%. Since the inflation represents a rise in price levels, we subtract it from the nominal rate to get a real GDP growth of 1%.

But in reality, price changes do not affect products and services in such a uniform and simple fashion. In the above example, all goods aren’t increasing in price at a 2% rate – that’s just an average. What really happens is that there is a full spectrum of price changes: some goods end up falling in price, while other goods get more expensive.

What’s Actually Getting More Expensive?

This week’s chart looks at the change in prices of consumer goods since 1996, using data provided by Mark J. Perry of AEI’s Carpe Diem blog.

Here’s his original chart, which is also very telling:

Price changes from 1996 to 2016

The average price increase, as shown by the CPI (Consumer Price Index), is 55% over the last 20 years. Meanwhile, the prices of individual sub-categories have a much wider variance.

The good news is that the price of technology is generally getting cheaper. Software, TVs, wireless, and new cars have all come down in price relative to the CPI. Clothing, toys, and furniture are also way more affordable than they were 20 years ago.

The bad news? Most of the above items are not the ones that really matter to most of us. The things we actually need to live healthy and fruitful lives – education, food, healthcare, childcare, and housing – are all skyrocketing in cost.

Tuition costs have soared 197%. Textbooks have more than tripled in price, going up 207% since 1996.

Taking care of our loved ones is more expensive. Healthcare and childcare costs have risen almost as much: 105% and 122% respectively.

Meanwhile, basic necessities such as shelter and food have increased at rates higher than the CPI as well. Housing costs are 61% higher and food is 64% more expensive.

Related Topics:prices healthcare costs CPI inflation

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COVID-19

The Road to Recovery: Which Economies are Reopening?

We look at mobility rates as well as COVID-19 recovery rates for 41 economies, to see which countries are reopening for business.

Published

3 years ago

May 28, 2020

Iman Ghosh

The Road to Recovery: Which Economies are Reopening?

COVID-19 has brought the world to a halt—but after months of uncertainty, it seems that the situation is slowly taking a turn for the better.

Today’s chart measures the extent to which 41 major economies are reopening, by plotting two metrics for each country: the mobility rate and the COVID-19 recovery rate:

Mobility Index
This refers to the change in activity around workplaces, subtracting activity around residences, measured as a percentage deviation from the baseline.
COVID-19 Recovery Rate
The number of recovered cases in a country is measured as the percentage of total cases.

Data for the first measure comes from Google’s COVID-19 Community Mobility Reports, which relies on aggregated, anonymous location history data from individuals. Note that China does not show up in the graphic as the government bans Google services.

COVID-19 recovery rates rely on values from CoronaTracker, using aggregated information from multiple global and governmental databases such as WHO and CDC.

Reopening Economies, One Step at a Time

In general, the higher the mobility rate, the more economic activity this signifies. In most cases, mobility rate also correlates with a higher rate of recovered people in the population.

Here’s how these countries fare based on the above metrics.

Country	Mobility Rate	Recovery Rate	Total Cases	Total Recovered
Argentina	-56%	31.40%	14,702	4,617
Australia	-41%	92.03%	7,150	6,580
Austria	-100%	91.93%	16,628	15,286
Belgium	-105%	26.92%	57,849	15,572
Brazil	-48%	44.02%	438,812	193,181
Canada	-67%	52.91%	88,512	46,831
Chile	-110%	41.58%	86,943	36,150
Colombia	-73%	26.28%	25,366	6,665
Czechia	-29%	70.68%	9,140	6,460
Denmark	-93%	88.43%	11,512	10,180
Finland	-93%	81.57%	6,743	5,500
France	-100%	36.08%	186,238	67,191
Germany	-99%	89.45%	182,452	163,200
Greece	-32%	47.28%	2,906	1,374
Hong Kong	-10%	97.00%	1,067	1,035
Hungary	-49%	52.31%	3,816	1,996
India	-65%	42.88%	165,386	70,920
Indonesia	-77%	25.43%	24,538	6,240
Ireland	-79%	88.92%	24,841	22,089
Israel	-31%	87.00%	16,872	14,679
Italy	-52%	64.99%	231,732	150,604
Japan	-33%	84.80%	16,683	14,147
Malaysia	-53%	80.86%	7,629	6,169
Mexico	-69%	69.70%	78,023	54,383
Netherlands	-97%	0.01%	45,950	3
New Zealand	-21%	98.01%	1,504	1,474
Norway	-100%	91.87%	8,411	7,727
Philippines	-87%	23.08%	15,588	3,598
Poland	-36%	46.27%	22,825	10,560
Portugal	-65%	58.99%	31,596	18,637
Singapore	-105%	55.02%	33,249	18,294
South Africa	-74%	52.44%	27,403	14,370
South Korea	-4%	91.15%	11,344	10,340
Spain	-67%	69.11%	284,986	196,958
Sweden	-93%	13.91%	35,727	4,971
Switzerland	-101%	91.90%	30,796	28,300
Taiwan	4%	95.24%	441	420
Thailand	-36%	96.08%	3,065	2,945
U.S.	-56%	28.20%	1,768,346	498,720
United Kingdom	-82%	0.05%	269,127	135
Vietnam	15%	85.02%	327	278

Mobility data as of May 21, 2020 (Latest available). COVID-19 case data as of May 29, 2020.

In the main scatterplot visualization, we’ve taken things a step further, assigning these countries into four distinct quadrants:

1. High Mobility, High Recovery

High recovery rates are resulting in lifted restrictions for countries in this quadrant, and people are steadily returning to work.

New Zealand has earned praise for its early and effective pandemic response, allowing it to curtail the total number of cases. This has resulted in a 98% recovery rate, the highest of all countries. After almost 50 days of lockdown, the government is recommending a flexible four-day work week to boost the economy back up.

2. High Mobility, Low Recovery

Despite low COVID-19 related recoveries, mobility rates of countries in this quadrant remain higher than average. Some countries have loosened lockdown measures, while others did not have strict measures in place to begin with.

Brazil is an interesting case study to consider here. After deferring lockdown decisions to state and local levels, the country is now averaging the highest number of daily cases out of any country. On May 28th, for example, the country had 24,151 new cases and 1,067 new deaths.

3. Low Mobility, High Recovery

Countries in this quadrant are playing it safe, and holding off on reopening their economies until the population has fully recovered.

Italy, the once-epicenter for the crisis in Europe is understandably wary of cases rising back up to critical levels. As a result, it has opted to keep its activity to a minimum to try and boost the 65% recovery rate, even as it slowly emerges from over 10 weeks of lockdown.

4. Low Mobility, Low Recovery

Last but not least, people in these countries are cautiously remaining indoors as their governments continue to work on crisis response.

With a low 0.05% recovery rate, the United Kingdom has no immediate plans to reopen. A two-week lag time in reporting discharged patients from NHS services may also be contributing to this low number. Although new cases are leveling off, the country has the highest coronavirus-caused death toll across Europe.

The U.S. also sits in this quadrant with over 1.7 million cases and counting. Recently, some states have opted to ease restrictions on social and business activity, which could potentially result in case numbers climbing back up.

Over in Sweden, a controversial herd immunity strategy meant that the country continued business as usual amid the rest of Europe’s heightened regulations. Sweden’s COVID-19 recovery rate sits at only 13.9%, and the country’s -93% mobility rate implies that people have been taking their own precautions.

COVID-19’s Impact on the Future

It’s important to note that a “second wave” of new cases could upend plans to reopen economies. As countries reckon with these competing risks of health and economic activity, there is no clear answer around the right path to take.

COVID-19 is a catalyst for an entirely different future, but interestingly, it’s one that has been in the works for a while.

Without being melodramatic, COVID-19 is like the last nail in the coffin of globalization…The 2008-2009 crisis gave globalization a big hit, as did Brexit, as did the U.S.-China trade war, but COVID is taking it to a new level.

—Carmen Reinhart, incoming Chief Economist for the World Bank

Will there be any chance of returning to “normal” as we know it?