Wednesday, August 15, 2012

Cable Prices Grow 70% Faster Than CPI, 1995 to 2011

Some products are difficult to assess, in terms of value for money. The problem occurs in the computer industry, where nominal "price" does not actually capture qualitative changes in the product. A standard PC sold in 2012 is much more capable than a PC sold in 1995, for example, whatever the nominal price.

Something of that problem is reflected in the prices consumers pay for cable TV service, to the extent that the channel line-ups are not equivalent between 1995 and 2012, for example. Cable operators argue that the dramatically higher number of channels in expanded basic accounts for the price hikes.

The argument is not without merit. But it arguably is a more subjective matter whether most consumers find the product qualitatively "better," in relationship to the quantitative increases in price.

1 comment:

Anonymous said...

Gary what is the source for the table?

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