[hackingonempty]

One of my hobbies is looking up old prices in the BLS CPI calculator to see what they would cost today (March 2026 is the latest data.)

The June 1940 photograph along Hwy 1 in Maryland had $0.05 hotdogs ($1.17) and $0.10 burgers ($2.34).

The Feb 1959 photograph from the NYC diner advertises a $0.45 burger ($5.14) and probably a $0.75 steak sandwich ($8.57)

[watersb]

I wonder if portion size is comparable.

We may have inflation in more than one sense: prices have gone up, and perhaps the size of burgers and hot dogs have also increased.

No doubt I can find portion size clues if I look around. Haven't done so yet.

[listenallyall]

Restaurant portion sizes have definitely increased - a lot - since the 1940s-50s. Maybe some minor pullback the last few years but still way larger than back then. A McDonald's Quarter-pounder was considered very large, that was in 1971, many sit-down restaurant burgers today are 5-8 oz.

[vikingerik]

One other thing to compare is business and health regulations. Compliance with that is certainly more involved and costly today than in 1940 and would account for part of the price.

[jen729w]

I'd love someone to build a tool that shows the price of that burger, say, and breaks it down to the input cost.

    Burger:    $5.00
    ----------------
    Meat:      $0.20
    Bun:       $0.05
    Staff:     $0.25
    Insurance: $4.50

[listenallyall]

The problem with this model is that the staff and insurance are essentially fixed costs, so if they sell 500 burgers on Saturday but only 250 on Tuesday, then the insurance cost-per-burger on Tues is double what it is on Sat. Staffing might increase by an extra body or two on the busy days but won't double, so it also has a much higher cost-per-burger on Tues.

I am not a restauranteur, just a customer (and observer) but I dont think many restaurant operators understand this concept either. Many seem to be raising prices to cover higher costs-per-item due to fewer customers to spread the fixed costs over. And then the higher prices turn more people off, now prices need to be raised again. Death spiraling themselves.

[TrueSlacker0]

Insurance is not a fixed cost. Property and auto insurance are, but liability is a percentage of sales, its fixed for a year then adjusted for next years planned sales.

[listenallyall]

"its fixed for a year"

[dugmartin]

I've heard the rule of thumb in a well run restaurant business is 30/30/30/10:

    1. 30% food costs
    2. 30% labor costs
    3. 30% overhead
    4. 10% profit margin

[throwup238]

That’s a good rule of thumb, minus the profit margin.

[jen729w]

Right. But how much of that 30% food cost is insurance that the farmer paid?

It's insurance all the way down.

[PaulRobinson]

You're getting very close to wanting to reinvent the Economist's Big Mac index: https://en.wikipedia.org/wiki/Big_Mac_Index

[userbinator]

If anything, I think they've probably decreased ("shrinkflation").

[goosejuice]

Not in the US. See "portion distortion".

https://pmc.ncbi.nlm.nih.gov/articles/PMC1447051/

https://pmc.ncbi.nlm.nih.gov/articles/PMC8667835/

Edit: hamburgers and hotdogs are pretty standardized though

[userbinator]

Unfortunately no mention of prices, so increase in portion sizes might be below inflation; and I suspect the former could be a strategy of compensation for inflation by making it seem less drastic ("yes it costs more, but we also made it bigger!")

[bryanlarsen]

The cost of labor has gone up faster than the cost of food ingredients so portion size inflation is a rational response by restaurants.

[kulahan]

Everyone knows what a quarter pounder is!

[saghm]

One time when I was a kid and my dad and I were in line at Fuddruckers, we overhead someone else in line say "I don't think I could eat a third of a pound, so I'll have to get a half a pound instead. It's still a reference we laugh about over two decades later.

[drittich]

Or do they? https://www.youtube.com/watch?v=EMNqJQaf08E

[astr0n0m3r]

Clearly, you've never seen Pulp Fiction.

[nullhole]

One neat inflation calculation I stumbled on is that inflation since 1945 to today is ~20x, so, from the film-noir era to today,

5¢ = $1

25¢ = $5

$1 = $20

$5 = $100

[dylan604]

These prices adjusted for today's value seem off though. I'm guessing you'd be hard pressed to find a diner burger for $5.14 anywhere. No, fast food joints are not the same here and not part of this discussion.

Where is the discrepancy? I've never really trusted these "adjusted for inflation" type numbers. I'm not an economist so I have no idea how they are calculated, but they've always just felt off to me. Usually, the numbers are for something esoteric to me, but these are about something I have some familiarity. In my experience, the adjusted burger price is about half the actual cost of today.

[bryanlarsen]

A good rule of thumb is to ask "are you paying mostly for human labor or for machine labor"? The former is likely to be more expensive now than it was in the past and the latter is likely to be less expensive, all relative to general inflation prices.

A hot dog / hamburger at a diner is mostly human labor, so you'd expect it to be cheaper in the past.

[cco]

Labor is typically around 30% of the final cost of prepared food in a restaurant.

Remaining 70% is 30% food costs (which has dropped drastically since the 50s), then 20-30% operations. Profit is whatever is left.

So a diner burger is not mostly labor but I honestly have no idea what these costs were 70 years ago. I'd love to know, seems like something is missing.

Likely everything in the chain going up 1-10%.

[Brian_K_White]

Food cost hasn't dropped because you can't even get the food they used to have. You have something that costs less now, but is worth even less than what it costs. And now that Sysco has completed it's eradication of all variety and competition, it doesn't even cost less any more.

[bryanlarsen]

Much of the 30% food costs is labour further up the chain, and much of the 20-30% operations is also labour.

[gyomu]

Things just don’t really convert neatly because the shape of what people spend money on in life hasn’t evolved uniformly.

Food appears somewhat cheaper, housing much cheaper; but clothing and tools/appliances were much more expensive. Things like student debt and healthcare costs are also interesting to compare and wildly differ over time & place.

Also common for the average middle class person to spend a sizable percentage of their income on travel/vacation today; as I understand it that was quite uncommon before the mid 20th century.

[xhkkffbf]

Travel and vacation were much rarer. Many jobs gave only 2 weeks a year of vacation. Many jobs didn't include travel. That's changed with the invention of cheap airlines. Alas, some like SWA have changed their business model.

[trhway]

I use "super-baskets" like say US GDP per capita

>The June 1940 photograph along Hwy 1 in Maryland had $0.05 hotdogs ($1.17) and $0.10 burgers ($2.34).

1940 $779 to today's $94K GDP per capita gives $6 for the 1940 $0.05 hotdog.

[yulker]

GDP is not distributed equally by any means, so meaningless as a per capita figure in this context

[frikskit]

94K GDP/Capita for US is wildly off it’s around 66K.

[trhway]

IMF 94K

https://www.imf.org/external/datamapper/NGDPDPC@WEO/USA/DEU

you're probably still in 2020 when it was 66K :) That is the real inflation here.

[jldugger]

Well, the $5.14 figure is using the generalized inflation number derived by tracking the price of a specific basket of goods over time, across the entire country. This is a reasonable number to pick.

If you narrow down to Food for all Urban Consumers[1], it shifts to more like $5.24. If you look at "Food away from home in New York-Newark-Jersey City, NY-NJ-PA, urban wage earners and clerical workers, not seasonally adjusted" that number moves to $7.60. Which confirms your intuition: restaurant prices are way higher than the overall inflation rate predicts.

How do we explain the difference? A variety of ways. Maybe the burgers you get are "better" in some way. Bigger. Better cut of meat. More veggies and toppings. I wasn't around in 1959 and never ate at that specific diner, but it's a real possibility. In fact, this is explicitly called out in the FAQ[3]:

> Specifically, in constructing the "headline" CPI-U and CPI-W, the BLS is not assuming that consumers substitute hamburgers for steak. Substitution is only assumed to occur within basic CPI index categories, such as among types of ground beef in Chicago. Hamburger and steak are in different CPI item categories, so no substitution between them is built into the CPI-U or CPI-W.

There's also some other complicating factors to account for, like coupons and bundling. Like consider Applebee's Really Big Meal Deal deal. "NEW Big Bangin’ Burger with unlimited fries & soda, still just $9.99" Or you can order just the burger for... $15.99[4]. I don't even know how BLS copes with that and am sorta guessing they just take the a la carte prices for consistency, even though that likely overstates price levels consumers actually pay?

[1]: https://data.bls.gov/dataViewer/view;jsessionid=3A241A4C4F0A... [2]: CWURS12ASEFV [3]: https://www.bls.gov/cpi/factsheets/common-misconceptions-abo... [4]: https://www.applebees.com/en/menu/handcrafted-burgers/big-ba...

[triage8004]

Burgers we get today are certainly not better than a 1945 burger in any way.

[jldugger]

I wasn't around so I'll have to take your word for it?

[buildbot]

Dicks in Seattle is currently only 5.75 for the deluxe; everything else is less! And IMO, very good for the money.

https://ddir.com/menu

[tomrod]

Basket goods, basically.

Price of good i x Quantity of good i. Quantity is fixed year to year. So a loaf of bread, a gallon of milk, a TV, etc.

Sum those up across a reasonably representative basket, then compare that sum to the same quantity and new prices in a future year.

sum(P_i_new year x Q_i) / sum(P_i base year x Q_i) - 1 --> change in CPI

Hamburgers might be more expensive, but TVs, toilet paper, and dog kibble might not be.

[peterbecich]

Agreed completely. Other examples: long-distance telephone minutes, shoes, clothing, air travel... probably all cheaper.

[woodruffw]

There are two diners near me (in NYC) where a burger is $5.25/$5.50 respectively.

(I don’t disagree with you directionally though; I think a nontrivial aspect of this is shifting expectations/norms around what passes for food service. Americans broadly want their food - even diner food - to be upclassed beyond a plain hamburger on a white bread bun.)

[gwerbin]

That's the point. Burgers are more expensive (relative to "all" other goods) compared to back then.

[itake]

Dick's Drive in Seattle (IMHO an expensive city) charges $5.75 for their deluxe burger on Doordash.

https://www.doordash.com/store/dick's-drive-in-seattle-77050...

[bdunks]

The Market Basket used to calculate the BLS CPI changes over time, which can make long range comparisons difficult.

I’ve read of political influence on the market basket to lower the reported rate of inflation by the incumbent party, but I’m not educated enough on the topic to give an opinion on if it happens.

[goosejuice]

Counter service family joints absolutely in the $5 area for standard ol' boring 1/4/lb. Maybe your definition of diner is different? There's a place by me with diner in the name that has a burger for $4.99.

[plemer]

That may be the point. Simple inflation adjustment gives us x but the real price is more or less than x. Why is that?

[JumpCrisscross]

> 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.)

[dylan604]

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.

[JumpCrisscross]

> 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.)

[db48x]

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.

[vkou]

Inflation is a measure of change in overall purchasing power.

What a specific purchase costs is highly dependant on the inputs, the cost of its labour (which might grow faster or slower than the average wage), and a lot of other factors.

Food is way more expensive today than it was 50 years ago. Airplane tickets are way cheaper. Everyone has a cellphone now, and middle class families have multiple cars, but a trip to the doctor will mean that ~15% of the population will be on the verge of not paying their bills. On the other hand, I have access to ~every major piece of music ever made for ~$15/month, so that's something.

[teaearlgraycold]

> $0.05 hotdogs ($1.17)

Costco not that far off.

[xhkkffbf]

The Costco dogs are bigger too than the hot dogs from that era. Much bigger.

[Barbing]

+$65 too :)

[zhainya]

only 65 :)