Is Living becoming cheaper?

I remember reading somewhere that a middle class modern family now has more luxuries than what was available to the Roman Emperor 2000 thousand years ago. This is probably true, and for those of us even with limited means, all the luxuries of modern life are available.

Today a middle class family, anywhere in the world, can get almost all spices that it wants, has access to most of  the medical facilities ( available in the market ) and can cure most illnesses, can afford some automobile, and live in a permanent dwelling, and basic water , sewage, electricity are mostly taken care of for most of us. The income is fairly regular and there are virtually no food shortages. Agree, that many poor in developing countries across Africa and Asia probably do not get the above luxuries, but for middle class families the above list holds true.

Clearly over the last 2000 years, human life style and standard of living have continuously improved. We do not see plagues or famines where 1000′s die

This set me into thinking about  the cost of living over a period of around 10o years in the past and how the cost of living might play out in the immediate future.

Everytime my parents go out to have dinner at a restaurant they crib about how cheap food was back then. It was the same with my uncle. I used to remind them that the wages also have gone up and we make much more money than back then.

I checked the historical prices of several items. Gold, land, crude oil, electronics, apparel, shoes etc for the last 30-40 years and what i found is  a bit surprising.

While electronics especially TV has fallen almost by 80 %, and computers like 90 %. Clothing and shoes have also fallen by 10-20 % in real value, all thanks to cheap imports from China. Gold has on the other hand sort of doubled in inflation adjusted real  value between 1970 and 2005.

Land has definitely inched ahead of inflation as it is a fixed commodity.  Food has gotten cheaper the last few decades. But i suspect it may start to get expensive as its production is closely linked to the available land, which is itself becoming scarce and expensive and also crude oil which is used in food production. So here is my quick list of things likely to get cheaper and expensive in the next 10-20 years:

Getting cheaper:

• Consumer Electronics
• Personal Computers
• Plastics
• Apparel
• Shoes
• Automobiles
• Medicines

Getting expensive:

• Land
• Food
• Wood, Plant related products like paper , pulp )
• Energy ( Crude Oil , Electricity )

Of course  prices of some resources like Crude Oil, some metals like copper or aluminium  or gold can follow a cyclical pattern.  And sometimes price disruptions happen due to discoveries of oil or ore deposits. Overall, i see a shortage of these resources and a gradual increase in the demand for these in the future.

One resource that could just make everything else cheaper is energy. If mankind were to every find a source of energy that is cheap and abundant,  that could make everything else cheaper. As of now, there is no energy source that comes close, but Nuclear Fusion energy and Solar power are two contenders. But it could be very long before energy, if ever, becomes cheaper.

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