Rochester Economics Professor Micheal Rizzo, who’s blog shares our affinity for Hayekian humility, had an excellent series of posts over the holidays. In the spirit of the Twelve Days of Christmas, he examined what the last century has shown us about the interaction of scarcity and productivity, and the effects on the cost of twelve resources, from salt and tin to cobalt and diamonds.
His point is that these goods are growing ever more scarce, yet generally the cost (computed in both work hours and real price) is much lower. He argues that this is not merely incidental to each commodity, but true as a general rule. Even something as fundamental as sweet delicious mouth-watering hickory smoked bacon.
He notes that the average American manufacturing worker earns a pound of bacon every 11 minutes, a decrease in real price of 73% since 1900. And all that despite nearly a century of farm policy that can best be described thus.
P.S. While googling ‘bacon’ images, these bacon-wrapped-scallops popped up. Set mouth to ‘water’.
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