Price is a market signal - information for producers to produce and consumers to express choice. Time Price is measured in seconds, minutes and hours. Time Price Equation: Nominal Price (what we see on shelves) of a good or a service DIVIDED by nominal hourly income = How long you have to work to buy something. We notionally buy things with money, though we are really conducting the economic alchemy of converting our time through labor (and thus wages) into goods. As long as hourly income rises faster than nominal prices, time price falls and abundance reigns over scarcity. Time-price normalizes the non-linear complexity between the changes in nominal prices and wage growth. Using Time-price as a lense it is hard to refute the continuous improvement in humanities quality of life over time - a positive upward drift driven by productivity gains (ref: [[Productivity Paradox]]) > New knowledge, New Tech and New Innovation let's people produce more with less. Time is a universal constant that flows in one direction, can't be inflated or cheated, is applied equally to all of us and is independent of what people do. > I'm always curious on ways in which we could measure progress, to influence [Exploring Ambiguity](app://obsidian.md/Exploring%20Ambiguity) x [domain specific sense-making](app://obsidian.md/domain%20specific%20sense-making) and find niches to build [[Ventures]] in. Associated ideas here are [[Koomey's Law]] and [[Murphy's Law]] ### Time-price Examples ![[Pasted image 20230826102919.png]] > The time price of a good/product could be cheaper now, even when the nominal (inflation adjusted prices) increase. The question is how many hours do you have to work to afford something today vs in a past time, given even that something's utility is also getting better. It has decreased for coffeemakers (-65%), toasters (-75%), blenders (-79%), vacuums (-83%), dishwashers (-62%), shavers (-74%), hairdryers (-67%) and sneakers (-67%). Time price of electricity has fallen (59%) from 1.8 cents per kilowatt-hour to 13.9 cents per kilowatt-hour. ![[Pasted image 20230826121732.png]] In the Lux Capital Investor Letter ^[https://drive.google.com/file/d/14_oQBcaIbLwzuEzWcEFJeEd1NzXwYWQs/view ], the examples are on showing how [[Time Price]] has been decreasing, which is positive and great. However this got me to think, that's where innovation is working, and you could say may be relatively less needed for disruptive shifts over areas where the Time Price is increasing. I also learnt about [[Malthusianism]] from the letter. One area I thought where I intuitively thought this would be is Housing. Why? 1. **Limited Supply**: Urban areas, especially popular ones, have limited space. As the population grows and more people want to live in these areas, the demand increases while the supply remains relatively constant or grows at a slower rate. 2. **Desirability and Job Opportunities**: Many of these cities have become hubs for certain industries (e.g., tech in San Francisco, finance in New York). This draws a large number of high-earning professionals to these areas, driving up demand and prices. 3. **Speculation and Investment**: Real estate in popular cities often attracts investors, both domestic and international. This can further drive up prices as properties are bought not for living but as investments. 4. **Regulations and Building Restrictions**: In some cities, regulations, zoning laws, or other restrictions can limit the construction of new housing, further constricting supply. 5. **Inelastic Demand**: Housing is a basic need, so even as prices rise, people still need places to live, which can mean they're willing (or forced) to dedicate a larger portion of their income to housing. So I that if were to chart the "Time-Price" of housing in many major cities over the past few decades, it would likely show an upward trend, indicating that even as people earn more, they're having to work longer hours (or dedicate a larger portion of their income) to afford housing. This doesn't apply universally, and there are cities and regions where housing remains relatively affordable. However, in many major urban hubs, housing affordability has become a significant issue. ![[Pasted image 20230826120204.png]] From the graph, it's evident that housing affordability, in terms of years of work at minimum wage, has increased over the decades. This indicates that despite wage increases over time, the cost of housing has risen faster, making it more challenging for individuals, especially those earning minimum wage, to afford a home. Remember, this is a simplification and doesn't account for factors like down payments, mortgages, or other costs associated with home ownership. It serves as a broad representation of housing affordability trends. ---