I was walking through Best Buy the other day, marveling at the technology. Not only was I fascinated with the size and clarity of the televisions, I was also impressed at the prices.
I bought a 27-inch Sony television about 14 years ago. I paid about $400 for it. The thing was a beast. For $400 today, you could buy at least a 39-inch television. Perhaps you could do even better with a sale. But you are also getting an HD tv that has a flat panel. It would weigh a fraction of that Sony tv I bought 14 years ago.
So as far as televisions, you can get far more for your dollar today. Prices are cheaper and the quality is far better. And that is in the face of inflation over the last 14 years. According to the BLS’s CPI inflation calculator, prices have risen by 40%. So, on the conservative side, prices have gone up 40%, while prices of televisions have fallen dramatically, with far better quality.
Although there is no major industry that is not heavily regulated by the government, it is not surprising that electronics and technology are regulated far less than other industries. Of course, Best Buy, Apple, and all of the other companies are subject to the same massive taxes and business regulations. But aside from this, electronics are not heavily regulated relatively speaking.
Meanwhile, in industries that are heavily regulated, it is no surprise that prices rise at a fast pace (usually faster than the stated CPI) and the quality does not get much better. In some cases, the quality even diminishes. I speak of industries such as education and healthcare that are heavily regulated and funded by government at all levels.
Imagine if education were more like the electronics industry. Imagine that we saw new innovations that allow children to learn better. (Ironically, the one bright spot of education is coming from the advancement in technology.) Imagine if prices went down, even in higher education. Imagine being able to choose different levels of education and different styles of learning, while having price competition.
Healthcare and medicine have even more potential if given a relatively free market environment. We wouldn’t have doctors all graduating with basically the same curriculum. We would see competition and innovation. We would see new technology advance quickly, while actually seeing a reduction in prices. We would have doctors trying various techniques, with those most successful likely being rewarded the most. We would see doctors actually trying to help their patients with things such as diet, instead of just throwing pills at patients to benefit the pharmaceutical industry.
In conclusion, we should advocate and hope for a more free market in every industry. We should also hope for more price deflation. Our standard of living has improved vastly with things like televisions, smartphones, tablets, and computers. There is no reason that we should not also benefit from better products and cheaper prices in other industries.