Economics & Energy

Price of Air Travel versus Other Goods and Services

A change in the price of any good or service over time has little value in isolation. Therefore, it is common practice to adjust the values in a time series for inflation. The adjusted (restated) values are then presented in "real" (rather than "nominal") terms. In the example below, however, rather than restating the various items in real (inflation-adjusted) terms, they are shown in their original values, facilitating comparisons with each other and with movements in the U.S. Consumer Price Index (CPI), a federal metric designed to capture the price of a representative basket of U.S. goods and services.

ITEM -- U.S. Good or Service Unit 1978* 1990 2007 GROWTH
College Tuition: Public1 Year $688 $1,908 $6,185 9.0 x
College Tuition: Private1 Year $2,958 $9,340 $23,712 8.0 x
Prescription Drugs2 Index 61.6 181.7 369.2 6.0 x
New Single-Family Home3 Home $55,700 $122,900 $247,900 4.5 x
New Vehicle6 Vehicle $6,470 $15,900 $28,800 4.5 x
Unleaded Gasoline7 Gallon $0.67 $1.16 $2.80 4.2 x
CPI (Urban-All Items)2 CPI-U 65.2 130.6 207.3 3.2 x
Movie Ticket8 Ticket $2.34 $4.22 $6.88 2.9 x
First-Class Postage5 Stamp $0.15 $0.25 $0.42 2.8 x
Whole Milk2 Index 81.0 124.4 205.4 2.5 x
Grade-A Large Eggs2 Dozen $0.82 $1.01 $1.68 2.0 x
Air Travel: International4 Mile 7.49¢ 10.83¢ 12.71¢ 1.7 x
Air Travel: Domestic4 Mile 8.49¢ 13.43¢ 12.98¢ 1.5 x
Television2 Index 101.8 74.6 16.9 0.2 x

*Congress enacted legislation deregulating domestic airline passenger service in October 1978.

1. The College Board – based on beginning of academic year
2. U.S. Bureau of Labor Statistics – includes hedonic “quality-change” adjustments
3. U.S. Census Bureau – median value
4. ATA via U.S. Bureau of Transportation Statistics – excludes taxes
5. U.S. Postal Service – Publication 100
6. National Automobile Dealers Association – average retail selling price
7. U.S. Department of Energy – Monthly Energy Report, Table 9.4
8. National Association of Theatre Owners

Last Modified: 7/23/2008

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