I loved this article. I was hoping you would address, though, differential purchasing patterns by income bracket. That is, median wages outstripping the CIP only tells us something interesting if increases to the CPI hit all incomes roughly equally. But if much of the rise of prices comes in, e.g. used cars, purchased more frequently by lower income buyers, (not to mention if wages increase faster at the top of the scale than at the bottom) then inflation becomes bad for poor people, too. No?
Yes, absolutely! It's exactly these sorts of relative comparisons that I think really matter. Overall inflation numbers could be flat, but certain prices (especially food, housing, transportation) could be rising for lower-income working people, or wages could be rising more slowly for that same group (while the median wage is pulled up from the top). These are the questions we should be focussing on.
I loved this article. I was hoping you would address, though, differential purchasing patterns by income bracket. That is, median wages outstripping the CIP only tells us something interesting if increases to the CPI hit all incomes roughly equally. But if much of the rise of prices comes in, e.g. used cars, purchased more frequently by lower income buyers, (not to mention if wages increase faster at the top of the scale than at the bottom) then inflation becomes bad for poor people, too. No?
Yes, absolutely! It's exactly these sorts of relative comparisons that I think really matter. Overall inflation numbers could be flat, but certain prices (especially food, housing, transportation) could be rising for lower-income working people, or wages could be rising more slowly for that same group (while the median wage is pulled up from the top). These are the questions we should be focussing on.
Thanks! (And good to meet you - I got turned on to your substack by a mutual friend at Reed College).