Comment by JumpCrisscross
18 hours ago
> Simple inflation adjustment gives us x but the real price is more or less than x. Why is that?
Restaurant economics are a function of ingredient costs and labour. I suspect ingredient costs are close to OP's estimated multiples. But real wages are way up since the 1950s. Anything with a large labour component of costs will have tended to rise faster than inflation, which is an average of goods and services.
(There are specialised metrics if you actually wanted to dig into this question.)
Are you saying the prices listed were just for the ingredients and not the actual cost to the person ordering? They mentioned they saw the price in a photo which suggest it is what the person would be charged. I get that labor costs would cause an increase of raw ingredient price comparisons for total prices. But if you could pay buy a burger for a nickel but now need $10, there is a definite issue in just a "simple" adjustment that suggests you'd only need $5. If the numbers are that far off because the simple needs to be more advanced, what's the point of the simple numbers? Bad data is worse than no data.
> Are you saying the prices listed were just for the ingredients and not the actual cost to the person ordering?
Sorry, no. I'm saying labour is probably a larger fraction of the burger's costs today than it was in the 1950s. (I'd naively guess profits are, too.)
That may be true, but I suspect that it’s also hard to compare apples to apples. A burger in 1959 is hard to compare to a burger today. Today’s burger almost certainly has twice as much meat. The invention of (and ubiquitous advertising of) the quarter–pounder means that everyone had to make their burgers larger to match. Sides are larger, drinks are larger, etc, etc.
But labor costs certainly have gone up too.
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