This thought came to me as I was food shopping. So I know there are things that increase the price of certain items (beer, cigarettes, sugar tax – UK) but they also increase with inflation each year like other foods such as bread.
Apparently, the average inflation raise over the last 10 years in the US is 2.37% as of July 2023. So if it is the same in another 10-years, over the space of 20 years inflation would be 4.74%, if we say inflation is the same? And so on and so on. If it continues wouldn’t prices, for say, bread just end up getting higher and higher and be like $10-15+? And as wages don’t rise with inflation the same way foods do fewer and fewer people each decade could afford it?
Now this is just random thoughts I had when shopping and I am not making any comments on any politics. All I wanted to know is, is my thinking true that prices will just go up and up indefinitely decade-on-decade, why or why not? And I am an idiot so imagine I am 5.
​
Edit: Went to sleep and woke up to about 300 notifications, thanks for your explanation to a Neanderthal like myself.
​
In: 4366
In theory, wages are supposed to more or less keep up with inflation. That hasn’t happened super consistently, especially over the last 30 years or so, but it has happened and wages are rising. By the time bread costs $10 a loaf, in theory, the average person will look at it the same way that they look at a $3 load of bread today.
Latest Answers