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AriZona Iced Tea Has Been 99 Cents in the U.S. for 30 Years

Blog Post | Economics

AriZona Iced Tea Has Been 99 Cents in the U.S. for 30 Years

In the past 30 years, the tasty beverage has become 145 percent more abundant on a personal level and 256 percent more abundant on a global level.

Summary: AriZona Iced Tea’s 99-cent price tag has remained unchanged for 30 years, despite inflation, competition, and changing consumer preferences. This article translates that feat into time prices, showing how AriZona’s beverage has become increasingly affordable for American workers.


AriZona Beverages began in New York City in the early 1990s the inspiration of Don Vultaggio. The colorful 23-ounce cans have become icons. AriZona doesn’t advertise much. It relies on its creative design to attract attention. “We use packaging and a value story, then a great product inside,” Vultaggio said. “The first time a person buys us is because of the package. And forever more, they’re buying it because it tastes great.”

So how has the tasty beverage been able to hold its price constant with rising costs? Since he was not able to control input prices, Vultaggio looked for other ways to innovate. “We’ve done things behind the scenes . . . things I can control, like faster lines, automation, shipping using trains, light-weight boxes so you get more on a load, shipping at night. Those kind of things are what the consumer doesn’t see but that’s what I’ve been doing as a businessman for decades.” In other words, continuously innovating to create value.

Innovation is the discovery and application of valuable new knowledge. We can measure this growth of knowledge with time prices. Innovation shows up in both lower prices and higher hourly incomes. The time price is the money price divided by hourly income. Money prices are expressed in dollars and cents, while time prices are expressed in hours and minutes.

In 1992, unskilled workers were earning about $6.43 an hour. By 2022, the rate had increased 144.5 percent to $15.72. At 99 cents, a can of AriZona iced tea cost 9.2 minutes in 1992, and it had fallen 59.1 percent to 3.8 minutes by 2022. For the time it took unskilled workers to earn the money to buy one can in 1992, they would get 2.44 cans in 2022. The beverage has become 144.5 percent more abundant at a personal level over the past 30 years. This statistic suggests that abundance is growing at a compound annual rate of 3.02 percent.

Global resource abundance is equal to personal resource abundance multiplied by population. During the past 30 years, the global population has increased by 2.5 billion, or 45.5 percent, from 5.5 billion to 8.0 billion. We can say that the global abundance of AriZona iced tea has increased by 255.6 percent, growing at a 4.32 percent compound annual rate.

Elasticity in economics measures the change in one variable compared with another variable. Every 1 percent increase in global population from 1992 to 2022 corresponded to a 3.18 percent increase in iced tea abundance at the personal level and a 5.62 percent increase at the global level.

By continuously innovating to hold prices constant, the beverage competes with Costco’s $1.50 hot dog and soda combo introduced in 1985.

When you enjoy your refreshing beverage, thank Don Vultaggio and the millions of other entrepreneurs creating value for our planet each day.

This article originally appeared in Gale Pooley’s Gale Winds Substack.

Blog Post | Food Prices

Home Alone with Pizza Abundance

For the time price of one pizza in 1990, unskilled workers get 3.8 pizzas today. Upskilling workers get 8.4.

In the classic 1990 holiday movie Home Alone, the McCallister family orders 10 pizzas and the bill comes to $122.50 (plus tip). Unskilled workers at the time were earning around $6.03 an hour. That would put the time price of the 10 pizzas at 20.3 hours, or about 2 hours per pizza.

A pizza delivery guy holds a pile of pizza boxes that costs $122.50 in the 1990 holiday movie Home Alone.

Jadrian Wooten and Chris Clarke over at Monday Morning Economist conducted a price check on how much 10 basic cheese and pepperoni pizzas cost today at a Little Caesars near the McCallisters’ home. It came to only $91.98 (plus tip). So, the nominal price of pizza actually shrank!

Unskilled workers are earning closer to $17.17 an hour today, so that would put the time price of 10 pizzas at 5.35 hours, or about 32 minutes per pizza. The time price of pizza has fallen by 73.6 percent. That means that for the time it took to earn the money to buy one pizza in 1990, you get 3.8 pizzas today. That’s a 280 percent increase in personal pizza abundance.

Since 1990, the US population has increased by 36.3 percent, from 248 million to 340 million. Each 1 percent increase in population corresponded to a 7.71 percent increase in pizza abundance.

Since 1990, pizza has become cheaper and wages have increased. An unskilled worker could purchase 3.8 pizza pies for the time price of one in 1990. A worker that moved from an unskilled to a blue collar profession could afford 8.4 pizzas for the time price of one in 1990.

If you started your first job in 1990 and went from being an unskilled worker to a blue collar worker in 2024, your hourly compensation (wages and benefits) increased from $6.03 an hour to $38 an hour. Your personal pizza abundance went from one pizza to 8.4 pizzas. Enjoy the party.

This article was published at Gale Winds on 10/22/2024.

Blog Post | Food Prices

Thanksgiving Dinner Will Be 8.8 Percent Cheaper This Year

Be thankful for the increase in human knowledge that transforms atoms into valuable resources.

Summary: There has been a remarkable decrease in the “time price” of a Thanksgiving dinner over the past 38 years, despite nominal cost increases. Thanks to rising wages and innovation, the time required for a blue-collar worker to afford the meal dropped significantly, making food much more abundant. Population growth and human knowledge drive resource abundance, allowing for greater prosperity and efficiency in providing for more people.


Since 1986, the American Farm Bureau Federation (AFBF) has conducted an annual price survey of food items that make up in a typical Thanksgiving Day dinner. The items on this shopping list are intended to feed a group of 10 people, with plenty of leftovers remaining. The list includes a turkey, a pumpkin pie mix, milk, a vegetable tray, bread rolls, pie shells, green peas, fresh cranberries, whipping cream, cubed stuffing, sweet potatoes, and several miscellaneous ingredients.

So, what has happened to the price of a Thanksgiving Day dinner over the past 38 years? The AFBF reports that in nominal terms, the cost rose from $28.74 in 1986 to $58.08 in 2024. That’s an increase of 102.1 percent.

Since we buy things with money but pay for them with time, we should analyze the cost of a Thanksgiving Day dinner using time prices. To calculate the time price, we divide the nominal price of the meal by the nominal wage rate. That gives us the number of work hours required to earn enough money to feed those 10 guests.

According to the Bureau of Labor Statistics, the blue-collar hourly wage rate increased by 240.2 percent – from $8.96 per hour in October 1986 to $30.48 in October 2024.

Remember that when wages increase faster than prices, time prices decrease. Consequently, we can say that between 1986 and 2024 the time price of the Thanksgiving dinner for a blue-collar worker declined from 3.2 hours to 1.9 hours, or 40.6 percent.

That means that blue-collar workers can buy 1.68 Thanksgiving Day dinners in 2024 for the same number of hours it took to buy one dinner in 1986. We can also say that Thanksgiving dinner became 68 percent more abundant.

Here is a chart showing the time price trend for the Thanksgiving dinner over the past 38 years:

The figure shows that the time price of a Thanksgiving dinner for a blue collar worker has gone down since 1986.
The figure shows that the time price of a Thanksgiving meal has decreased, while population, the nominal price of the meal, and hourly earnings have all increased.

The lowest time price for the Thanksgiving dinner was 1.87 hours in 2020, but then COVID-19 policies struck, and the time price jumped to 2.29 hours in 2022.

In 2023, the time price of the Thanksgiving dinner came to 2.09 hours. This year, it came to 1.91 hours – a decline of 8.8 percent. For the time it took to buy Thanksgiving dinner last year, we get 9.6 percent more food this year.

Between 1986 and 2024, the US population rose from 240 million to 337 million – a 40.4 percent increase. Over the same period, the Thanksgiving dinner time price decreased by 40.6 percent. Each one percentage point increase in population corresponded to a one percentage point decrease in the time price.

To get a sense of the relationship between food prices and population growth, imagine providing a Thanksgiving Day dinner for everyone in the United States. If the whole of the United States had consisted of blue-collar workers in 1986, the total Thanksgiving dinner time price would have been 77 million hours. By 2024, the time price fell to 64.2 million hours – a decline of 12.8 million hours or 16.6 percent.

Given that the population of the United States increased by 40.4 percent between 1986 and 2024, we can confidently say that more people truly make resources much more abundant.

An earlier version of this article was published at Gale Winds on 11/21/2024.

Business Standard | Food Prices

India’s Average Household Food Spending Falls Dramatically

“According to the paper, the share of total household expenditure on food has declined substantially in rural and urban areas across all states and UTs.

‘It is the first time in modern India (post-independence) that average household spending on food is less than half the overall monthly spending of households and is a marker of significant progress,’ it said.

The paper is a comprehensive analysis of the Household Consumption Expenditure Survey 2022/23 and comparison with 2011/12.

‘Overall, there has been a significant increase in households’ average monthly per capita expenditure across rural and urban India across all states and UTs,’ the paper said, adding that the magnitude of the rise is substantial but varies across states and regions.”

From Business Standard.