American Living Standards: Evidence from Recreational Expenditures

Abstract

Real income is an imperfect measure of trends in living standards. Current income numbers are deflated using a consumer price index and the many sources of bias in the consumer price index have been emphasized by the Boskin Commission (Boskin et al. 1998). Real income does not account for such goods as health that are not purchased in the marketplace, for quality changes, for revolutionary technological change, and for increases in leisure. Trends in health suggest that we may be overestimating income increases in the nineteenth century and underestimating income increases in the twentieth (Costa and Steckel 1997). Cutler et al. (1998) find that between 1983 and 1994 the price of heart attack treatments fell by 1.1 percent per year, once adjustments are made for quality, whereas a conventional price index suggests that prices were increasing. Nordhaus (1997) 132, 168, 169). After 1940, paid vacations, holidays, sick days, and personal leave increased and retirement rates continued to rise, while the average work week remained unchanged.

Economies of Scale in the Household: Puzzles and Patterns From the American Past

“…Due to the difficulty of constructing a time‐invariant measure of entertainment, and the expansion of entertainment and leisure options on the market during this time period, it is not clear how to interpret the lack of a trend in the entertainment scale economy. For more on the difficulties of capturing a time consistent measure of entertainment, see Costa (1999).…”

Is Participation in Tourism Market an Opportunity for Everyone? Some Evidence from Italy

“…In developed economies, travel expenditure has become part of the budget of most households. It affects their feeling of well-being, and thus is a suitable measure of standard of living or well-being (see Costa 1997Costa , 1999Zheng and Zhang 2013). Cracolici et al (2013) investigating the main determinants of the subjective economic wellbeing of four typologies of Italian households found that "if a household can get away on holiday -not an essential need -there is a positive and strongly significant effect on SEW (i.e.…”

Are Two Incomes Needed to Prosper Today? Evidence from the 1960s to the 1990s

“…Interestingly, they found the average consumption of the poorest households in 1990 to be equivalent to the average consumption of middle income households in 1970. Costa (1999) also uses an unconventional measure of prosperity. Citing problems with inflation adjustments using the CPI and with the inability of real income measures to account for changes in product quality and the availability of nonmarket goods, Costa uses changes in spending on recreation to measure trends in household prosperity.…”