> Inflation/deflation is decrease/increase in the value of money, separate from technological progress or supply and demand of real products.
If $1 gets you X capabilities, but the same $1 gets you X-1 capabilities later, is that not inflation? The same $1 gets you less. Whereas getting X+1 for $1 is deflation: the $1 gets you more.
The capability is how many calories you can get (Food), how much space you have to live (Shelter), how far you can go (Transportation: $y gets you z litres).
In the Radio Shack example, $1600 got me some capabilities in 1991, and some other capabilities in 2024: am I getting more, or fewer, capabilities? Further, how many hours would I have had to work in 1991 (e.g., minimum wage) to make that $1600 versus the hours I have to work in 2024?
I'm not sure it's a meaningful question... for $1600 I can get an iPhone which is more capable than anything you could buy for any price in 1991. Is the argument that this means there's been deflation? To me its a category difference and you can't compare because prices aren't set entirely by capability conferred but also by cost of production and demand.
If $1 gets you X capabilities, but the same $1 gets you X-1 capabilities later, is that not inflation? The same $1 gets you less. Whereas getting X+1 for $1 is deflation: the $1 gets you more.
The capability is how many calories you can get (Food), how much space you have to live (Shelter), how far you can go (Transportation: $y gets you z litres).
In the Radio Shack example, $1600 got me some capabilities in 1991, and some other capabilities in 2024: am I getting more, or fewer, capabilities? Further, how many hours would I have had to work in 1991 (e.g., minimum wage) to make that $1600 versus the hours I have to work in 2024?