Yes, it’s wrong. Relative price increases != inflation. If GDP growth declined but energy production remained the same, the price of energy wouldn’t fall concordantly with GDP (as it would if we were talking about all prices rather than relative prices).
Edit: Which doesn’t necessarily affect his point, I think he is actually trying to talk about the general rise in all prices.
Edit again: Never mind, I read further on, he thinks rising energy prices growing in accordance with GDP is “not real growth,” just inflation. If people’s standard of living has gone up, it’s real growth.
Edit once more for an example: A crazy new iphone comes out and it’s so awesome! But the input prices of all the other things I normally use also go up by the exact amount the new iphone would cost me, so it’s not growth. :(
But that’s not right. If you like the iphone more than some of the other things you use—WAY more than some of the other things you use—then you ditch those things and you buy the iphone. Win for you. If we’re talking about replacing basic inputs like food, maybe energy prices cancel out some productivity gains there, but for the huge swathe of things we classify as entertainment or information, the claim doesn’t apply.
he thinks rising energy prices growing in accordance with GDP is “not real growth,” just inflation
And this claim is essential to his argument, because he has an argument why (once we have a Dyson sphere) energy prices won’t rise much slower than nominal GDP, but he does not have an argument why prices in general won’t rise much slower than nominal GDP.
Yes, it’s wrong. Relative price increases != inflation. If GDP growth declined but energy production remained the same, the price of energy wouldn’t fall concordantly with GDP (as it would if we were talking about all prices rather than relative prices).
Edit: Which doesn’t necessarily affect his point, I think he is actually trying to talk about the general rise in all prices.
Edit again: Never mind, I read further on, he thinks rising energy prices growing in accordance with GDP is “not real growth,” just inflation. If people’s standard of living has gone up, it’s real growth.
Edit once more for an example: A crazy new iphone comes out and it’s so awesome! But the input prices of all the other things I normally use also go up by the exact amount the new iphone would cost me, so it’s not growth. :(
But that’s not right. If you like the iphone more than some of the other things you use—WAY more than some of the other things you use—then you ditch those things and you buy the iphone. Win for you. If we’re talking about replacing basic inputs like food, maybe energy prices cancel out some productivity gains there, but for the huge swathe of things we classify as entertainment or information, the claim doesn’t apply.
And this claim is essential to his argument, because he has an argument why (once we have a Dyson sphere) energy prices won’t rise much slower than nominal GDP, but he does not have an argument why prices in general won’t rise much slower than nominal GDP.