How much cheaper are cars, TVs, DVDs, phones and computers than they used to be – and why?

How much cheaper How much cheaper are cars, TVs, are cars, TVs, DVDs, phones and DVDs, phones and computers than computers than they used to be – they used to be – and why?and why?

Cheaper than ever beforeCheaper than ever before

““Tesco is offering what it claims is the UK's Tesco is offering what it claims is the UK's cheapest digital set-top box. With a price cheapest digital set-top box. With a price tag of just £10, the Freeview box will tag of just £10, the Freeview box will certainly sound like a bargain to anyone certainly sound like a bargain to anyone who forked out over £100 to be in the first who forked out over £100 to be in the first wave of Freeview box owners. Sitting next wave of Freeview box owners. Sitting next to it on the shelf could be Tesco's newly-to it on the shelf could be Tesco's newly-launched £9 DVD player, while other launched £9 DVD player, while other supermarkets and the internet are offering supermarkets and the internet are offering equally knock-down prices for a range of equally knock-down prices for a range of electronic goods.” electronic goods.”

(BBC News, 2007)(BBC News, 2007) Source: Source: http://news.bbc.co.uk/1/hi/technology/6968789.stmhttp://news.bbc.co.uk/1/hi/technology/6968789.stm

How much have prices How much have prices fallen over the last ten fallen over the last ten years?years?

Powerful computersPowerful computers

DVD playersDVD players

Small TVs and flat monitors Small TVs and flat monitors

Electronic toysElectronic toys

Cameras and camcordersCameras and camcorders

Musical equipmentMusical equipment

Mobile phonesMobile phones

CD and DVD discsCD and DVD discs

90% (£2,500 model now £250)90% (£2,500 model now £250)

90% (£300 player now £30)90% (£300 player now £30)

76% (£400 model now £100)76% (£400 model now £100)

45% (£20 toy now £11)45% (£20 toy now £11)

40% (£300 camera now £180)40% (£300 camera now £180)

40% (£50 boogie-box now £30)40% (£50 boogie-box now £30)

33% (£90 handset now £60)33% (£90 handset now £60)

50% (£16 disc now £8)50% (£16 disc now £8)

Source: Dr Mark Perry, University of Michigan http://mjperry.blogspot.com/2008/07/for-some-products-theres-been-major.html

Why have prices fallen?Why have prices fallen?

There are many reasons for falling There are many reasons for falling prices, but one KEY FACTOR has prices, but one KEY FACTOR has been the falling costs of making been the falling costs of making electronic goods. In particular, the electronic goods. In particular, the lowlow wages wages paid to workers in paid to workers in ChinaChina has led to factories being set has led to factories being set up there that can produce goods up there that can produce goods more cheaply than in Europe. Much more cheaply than in Europe. Much of what we buy is now of what we buy is now importedimported from China – and is very cheap to from China – and is very cheap to buy. The lives of shoppers in the buy. The lives of shoppers in the UK and factory workers in China UK and factory workers in China have become have become inter-connectedinter-connected. .

Good newsGood news

“ “A piece in A piece in The TimesThe Times newspaper last newspaper last year reported a decline in the number of year reported a decline in the number of burglaries, which was put down to the burglaries, which was put down to the fact that the thieves can no longer get a fact that the thieves can no longer get a good price for the items they steal. Who good price for the items they steal. Who wants to nick a second hand DVD player, wants to nick a second hand DVD player, when you can buy a new, legal one for when you can buy a new, legal one for £20?” (£20?” (BBC NewsBBC News, 2005), 2005)

Signs of the timesSigns of the times

According to According to BBC NewsBBC News, you know , you know manufactured goods are getting cheap manufactured goods are getting cheap when: when:

children get spoilt at Christmas, children get spoilt at Christmas, because toys are so affordable because toys are so affordable

CDs are sent out as junk mail CDs are sent out as junk mail repair shops disappear from the high repair shops disappear from the high

street street it's cheaper to buy a new kettle, than it's cheaper to buy a new kettle, than

to fix an old oneto fix an old one

Source: Source: http://news.bbc.co.uk/1/hi/business/4174587.stmhttp://news.bbc.co.uk/1/hi/business/4174587.stm