The real income of the median US household has increased by a cumulative nine percent since 1980. Taken as a standalone figure, it looks like Americans in the middle aren’t much better off than they were back then.
But 35 years ago, we were all keeping our data on floppy disks, and making calls from landlines. So are we better off now than we were when Gordon Gekko’s DynaTac 8000X was a status symbol? The IGM Economic Experts Panel put it to a vote, and the consensus seems to be: “Yes, but…”
The nine percent cumulative increase in real US median household income since 1980 substantially understates how much better off people in the median American household are now economically, compared with 35 years ago.
Sixty percent of the panelists either agreed or strongly agreed that the figure understates household well-being, pointing to the goods and services available now that were the stuff of science fiction a few decades ago. “So much of our day is spent doing things that didn’t exist back then,” wrote Austan Goolsbee of Chicago Booth, “that it’s hard to believe the #s fully account for new products.” In addition to technological advances, panelists cited medical breakthroughs and better air quality as evidence of a higher quality of life.
“No one I know would rather face the 1980 bundle of goods (at 1980 prices) than current bundle, at anywhere near the same incomes,” wrote Anil Kashyap of Chicago Booth.
Life in the twenty-first century, alas, is not all smartphones and fresh air. Our gadget-enabled workaholic tendencies, including “hours worked, hours connected to work email at home,” wrote Aaron Edlin of Berkeley, leave plenty of room for uncertainty. Moreover, great well-being is easily measured at the bottom and top, but it’s “not so clear at the median,” wrote Robert Hall of Stanford.