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Consumer Price Inflation Since 1750
Composite consumer price index with description and assessment of source data, and examples of how to revalue historical amounts to current day prices and calculate changes in purchasing power.
Author: Jim O'Donoghue
Economic Trends, no No. 604, pp 38-46. ISSN: 0013-0400
This article presents a composite price index covering the period since 1750 which can be used for analyses of consumer price inflation, or the purchasing power of the pound, over long periods of time. The index is based on both official and unofficial sources and replaces previous long-run inflation indices produced by the ONS, the Bank of England and the House of Commons Library. It shows that:
- between 1750 and 2003, prices rose by around 140 times;
- most of the increase in prices has occurred since the Second World War: between 1750 and 1938, a period spanning nearly two centuries, prices rose by a little over three times; since then they have increased more than forty-fold.
Put another way, the index shows that one decimal penny in 1750 would have had greater purchasing power than one pound in 2003.
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