Dear Economist,
I wish I frequented the same high street as the statisticians who calculate measures of inflation. Given their calculations include “Various selected popular brands of sweets, chocolates, gum”, will they take note of a Mars Bar shrinking in size from 62.5g to 58g while remaining the same price? I make this an effective price increase of 7.76%. If not, when are those lying bastards going to stop lying to me?
Ralph Corderoy
Dear Mr Corderoy,
Your arithmetic is correct but your objection is confused. The statisticians – or “lying bastards”, au choix – do indeed adjust for such changes. It is far easier for them to do that than to make the many other adjustments they attempt every year to cope with the fact that nobody knows how many gramophones there are in an iPod.
Certainly, you are right to suspect that when the bean-counters go out to calculate inflation, they are not buying exactly the same products that you buy. How could they? Some people spend a lot on petrol, heating and mortgage payments; others are more interested in clothes, fast-food and laptops. The statisticians’ best can never be quite good enough.
I will concede, though, that the Mars Bar has been worthy of scrutiny ever since the late Nico Colchester noted in the Financial Times back in 1981 that it was a very stable unit of account. It is a veritable ingot of basic commodities (sugar, milk, cocoa) that has kept its value relative to the price of other goods such as small cars, which have cost about 20,000 Mars Bars for the past 70 years.
Fortunately, there is no strong trend towards debasing the Mars Bar – its weight has always fluctuated. It weighed 57g in the late 1970s and as much as 67g in the mid-1980s: 58g is simply a return to historical norms after something of a Mars Bar bubble.
Also published at ft.com.