Unprecedented Spending Trends in America

Here is a very cool chart by Yuka Kato, “Unprecedented Spending Trends in America, in One Chart.”

How Americans spent their money in the last 75 years
This chart illustrates U.S. consumer expenditure trends from 1941 to 2014. During this period household spending on education, recreation, healthcare, transportation and housing increased significantly while spending on tobacco, clothing and food declined. Housing and transport represent the largest absolute expenditure increases.

You could argue that this represents an increase in consumer welfare (i.e., people are better off overall), based on the assumption that more expensive transportation and housing reflect their preferences. However, these increases may reflect a decline in the availability of affordable transport and housing options, such as degraded walking conditions, reduced public transit services, more sprawled, automobile-dependent community design, and reduced supply of affordable housing types such as townhouses and apartments. If so (and my research indicates that this has occurred) then many households are forced to spend more without any net benefit – an economic trap that makes many people (particularly those with lower incomes) worse off overall.

For more discussion see Affordable-Accessible Housing in a Dynamic City: Why and How to Support Development of More Affordable Housing in Accessible Locations.