The Internet Might Be Keeping Inflation Low

Austan Goolsbee and Peter Klenow have taken a crack at estimating e-inflation: the inflation rate of items bought online compared to those bought offline. They make use of the Adobe Analytics dataset to calculate a Digital Price Index (DPI) and then compare it to a matched set of items from the normal CPI basket of goods. Here’s the result, with ordinary CPI-U overlaid on their chart:

As you can see, they calculate that DPI is quite a bit lower than the matched CPI: about four points lower over the course of nearly four years. However, the fact that the basket of goods happens to be one that’s been deflating over the past four years makes me wonder if it’s really representative of overall inflation. If it is, then overall e-inflation has been about four points lower than CPI-U. If not, then who knows?

This is above my pay grade, but here are a couple of interesting charts from their paper. First of all, there’s one category where buying online apparently doesn’t help. Can you guess what it is?

Good ol’ health care. Apparently prices rise faster online than offline for medical supplies. Yeesh. But in the news-you-can-use category, check out recreational goods:

Every year, like clockwork, there’s a sudden drop in November. So if you’re looking for a good deal on sleeping bags or canoes, buy online in November. You’re welcome.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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