I always wonder if inflation is taken in account when they say “it’s the first movie since titanic that makes so much money”… “it’s the highes grossing movie ever” and then every year there is a highest grossing movie… but money is worth less than 60 years ago, so my question is: is it really the highest grossing movie? Is it?
In: Economics
As a counterpoint to these other comments, yes, the existence of currency devaluation doesn’t change the definition of the word gross. You can manipulate data to make any point you want, but highest grossing is highest grossing. Inflation is a factor, but ranking films by inflation adjusted box office is just as much cherry-picking as any other metric. If inflation were so instrumental and central to the financial performance of modern blockbusters, then why doesn’t every new theatrical release eclipse the box office of decades old films? That is clearly not the case, so there must be other contributing factors. Solely looking at adjusted grosses wrongly assumes purchasing power rises commensurately with inflation and ticket pricing. Minimum wage in the US hasn’t changed in 15 years, has there been no inflation in the last 15 years? Inflation adjusted gross also ignores alternative formats, purchasing power, industry changes in how grosses are split between the distributor and the exhibitor, the advent of television, internet, cable, home video, streaming, piracy, etc.
People generally consider Gone with the Wind to be the highest grossing film, inflation adjusted, but how useful is it to compare a film with seven theatrical releases across 80+ years to a modern film? Should you only compare the inflation adjusted grosses of Avatar since 2009 against Gone with the Wind’s inflation adjusted box office from 1940 to 1955? In the 40s, people might go to the theater just for the air conditioning, so a 4-hour runtime was a great value proposition in that regard. Is that even worth considering? Probably not, as there’s really no end to this thought exercise. Unadjusted gross is a simple metric to evaluate relative performance, and it’s as useful a success indicator as anything else.
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