Technology got dramatically cheaper. We built The Deflation Index to measure exactly how much and help you understand where the productivity gains went.
Computing power increased 100,000x. Solar panels fell 98%. Data transmission became nearly free. These aren't opinions - they're verifiable cost reductions measured in $/GFLOPS, $/kWh, $/GB.
So why don't living standards reflect this proportionally? Where did the productivity gains flow?
This is measurement, not theory. Every data point is sourced from government agencies and international organizations. Every formula is verifiable on GitHub. Every calculation is transparent.
Technology delivered massive cost reductions. Yet living standards didn't improve proportionally. Where did the productivity gains go?
From 1990-2024, core technology sectors showed dramatic deflation. Computing fell 99%, communications 99%, energy 90%, and transportation 88%. These are exponential improvements measured by cost-per-performance.
Yet consumers experienced different outcomes. Some benefits reached them (cheaper devices, unlimited data). But much of the productivity gain concentrated elsewhere, in asset prices, financial markets, real estate, and system complexity.
The Deflation Index measures technological cost reduction rigorously, then compares to economic indicators to understand distribution patterns.
Investors use it to identify sectors with real deflation vs monetary distortion.
Businesses use it to see which sectors have sustainable cost reduction.
Individuals use it to understand why life feels expensive despite technological progress.
Researchers use it to access rigorous methodology with transparent calculations.
See the full breakdown on our homepage.
Rigorous methodology: We track cost-per-performance metrics ($/GFLOPS, $/GB, $/kWh, $/kWh battery) across four sectors, weighted by economic importance. The Master Deflation Index is calculated using a geometric mean to properly capture compounding effects.
Complete transparency: All data, formulas, and source citations are public on GitHub. 900+ verified formulas. 400+ data points. 35 years of coverage (1990-2024). Anyone can download the Excel files, verify every calculation, and reproduce the results.
Authoritative sources: Federal Reserve (M2), Bureau of Labor Statistics (CPI), IRENA (solar), BloombergNEF (batteries), DOE (energy), FCC (communications), AI Impacts (computing). Average source reliability: 92/100 (A-grade).
Conservative estimates: Where uncertainty exists, we choose the more conservative assumption. The true technological deflation is likely higher than we measure. This index understates the gap, not overstates it.
We track data, not narratives. The index captures systematic patterns across decades, not cherry-picked examples or anecdotes. If the numbers change, we change the conclusion. Precision over persuasion.
Every source is cited. Every formula is visible. Every assumption is documented. Trust comes from verification, not credentials. Anyone can download the data, check the calculations, and challenge the work.
We describe mechanisms, not motives. Monetary policy is a counterforce to technological deflation - that's an observable pattern, not a judgment. The system can be measured without being moralized. Let the data speak.
The research is public. The data is accessible. We encourage academic use, journalistic citation, policy analysis, and critical scrutiny. Knowledge compounds when shared. This work improves through collaboration, not defensiveness.
The Deflation Index should become the standard measure for tracking technological progress and its economic distribution.
Just as CPI measures consumer inflation, the DI should measure technological deflation, and the gap between them should inform monetary policy, investment strategy, and political economy.
Why this matters: Technology is the primary driver of human prosperity. Understanding where those gains flow (to consumers, to capital holders, to asset prices, to complexity costs) is essential for economic policy and social equity.
What we're building: The infrastructure for rigorous, transparent measurement. Clean data. Robust methodology. Open documentation. Collaborative refinement. A foundation for understanding the economics of technological progress.
This work will expand to additional sectors, improve with better data, and evolve through critical feedback. The index is never finished, but it's built to compound over time.
The Deflation Index is an independent analytical initiative combining economics, data science, and systems thinking. We're a small team committed to rigorous analysis and transparent methodology.
Current focus: Building the most comprehensive, verifiable measure of technological deflation available. Ensuring every number is defensible, every source is credible, and every conclusion follows from the data.
We're looking for:
Interested? Email us at [email protected]
The Deflation Index is an open research project. We welcome collaborators who want to improve, extend, or challenge our work.
Economists, data scientists, and researchers interested in technological deflation, monetary policy, or price measurement. We welcome peer review, methodological critiques, and academic partnerships.
Help us improve data quality, extend coverage, or build better visualization tools. All our data is public and our methodology is transparent.
Domain experts in computing, communications, energy, or transportation who can help us validate assumptions, identify new data sources, or refine our metrics.
We actively welcome thoughtful criticism. If you see flaws in our methodology, gaps in our data, or errors in our calculations, we want to hear from you.
Found an error? See something that doesn't look right? Open an issue on GitHub for data errors, formula mistakes, missing citations, or website bugs.
Want to fix something yourself? We accept pull requests for data corrections, documentation improvements, new data sources, and methodology refinements. View the repository.
We're planning to expand to healthcare, education, and housing in v4.0. If you have expertise in these areas or want to propose other sectors, email us with your proposed sector definition, available data sources, suggested metrics, and relevant background.
Contribution Standards: All contributions must include source citations. We prioritize high-quality, quantifiable, and independently verifiable data. Speculative or promotional content will not be accepted.
The Deflation Index is built on transparency. The data is public, the methodology is documented, and the work benefits from scrutiny.