Wednesday, January 14, 2009

Lumens and Tungsten and Bulbs - Oh My!

Over at Carpe Diem, Professor Perry has been having some fun pointing out how clearly superior products from present day actually cost significantly less than the same products from decades ago. There are some great pictures from old Sears catalogs, so I suggest you check out some of his articles. I point this out because it is important to remember that over the last few centuries, life has gotten progressively better. We work less and enjoy leisure time more, with more opportunities for recreation and serious pursuits. Even if these current times seem clouded with uncertainty, the challenges don't even seem as daunting as in the previous century. The century before that saw the country engage in a great civil war that killed a larger portion of our population than any war before or since. And in the century prior to that, we struggled against the greatest empire of the age, that sent the largest expeditionary force ever before assembled in the history of the world to defeat us, and yet we prevailed.

Back on purely economic terms, the arguments persist as to whether we are really better off, are goods really cheaper. This is a classic problem in economics, to the cost of like problems from different eras. It was tackled by William Nordhaus in 1998 in a paper on the unit cost of a lumen, a measure of light flux, i.e. photons per unit of time. Neither photons nor time have changed significantly over the course of the study. Not surprisingly, Nordhaus concludes that traditional economic measures significantly underestimate the cost benefits of quality improvements over time. His study showed that the cost of a lumen had declined by a factor of almost 400 since 1800. Different technologies such as the transition from tallow candles to light bulbs and then the introduction of tungsten and finally fluorescent bulbs continued to make the production of light less expensive. But in economic measures, the production of candles and their costs are one part of the measure of economic output. In fact, candles are now largely decorative. It is the production of a lumen that is a better measure of economic well being.

Some selected data (you can see the whole thing on page 23):
Year------Technology---------Price (cents per 1,000 lumen-hours)
1800--Talllow candle----------40.293
1815--Whale oil lamp----------29.886
1875--Gas lamp-----------------5.035
1883--Edison carbon lamp-------9.228
1900--Filament lamp------------2.692
1940--Filament lamp------------0.392
1992--Fluorescent bulb---------0.124

The study is a bit of a slog, but it is worth looking at the tables and graphs. I remember an article in The Economist on this some years ago, but couldn't find the piece to link.

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