Update (6 June 2019): I have changed the title of this blog post to reflect a more likely explanation for the price changes pictured below. For more information about William Baumol and the so-called “Baumol effect”, see here.
Economics professor Mark Perry (@Mark_J_Perry) recently posted an updated chart (pictured above) of price changes of certain consumer goods and services in the U.S. In summary, his chart shows falling prices for free-market goods like TV sets and toys as well as rising prices for such publicly-subsidized services as health care and higher education.
Rather misleading. This has nothing to do with “free market” vs “subsidies” but rather whether the item is imported from a cheap-labor nation or is a service involving domestic labor. I could argue that it is China who we are subsidizing here…