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How Markets Brought Refrigeration to the Masses

Blog Post | Adoption of Technology

How Markets Brought Refrigeration to the Masses

In 1919, a refrigerator cost $11,000 in today's money.

The weather outside is frightful. The so called Big Freeze now grips the United States for the second week, and the United Kingdom too is experiencing its own blast of Arctic weather. All this chilly weather reminded me of an article written in The Telegraph last month about ice-houses, which were the go-to method of refrigeration just a couple of hundred years ago.

Back then, refrigeration was an arduous task and available only to the richest aristocrats. In the pre-industrial world, in order to refrigerate foodstuff, people needed the land to build an ice house (a building to store the ice), fresh water access, and servants to cut and hull the ice. Moreover, the ice had to be restocked regularly and was available only in some climates and at some times.

At the crack of dawn on a freezing morning the servants of the manor would visit nearby frozen shallow water and hack at the ice until it was in large slabs. The ice would then be painfully carried back to the small ice-houses, “to be stored with layers of straw and sacking,” in-between food. With luck, ice would last until next winter. If it did not, people had to do without ice.

By contrast, today refrigeration is easy. According to the latest government data more than 99.8 percent of American homes own at least one refrigerator. Furthermore, the US Census Bureau estimates the US poverty rate to be 13.5 percent. That means that essentially everyone in poverty, as defined by the government, has access to a technology that was reserved for the mega-rich just 200 years ago. Additionally, almost 25 percent of Americans now have two refrigerators to store their excess food and drink.

The growing prevalence of refrigerators is partly due to their declining cost and partly due to people’s growing incomes. In 1919, the Frigidaire was the first self-contained refrigerator. It cost $775 (over $11,000 in today’s money). As the average hourly wage in 1919 was just $0.43, it took the average American 1,802 hours of work to afford this luxury appliance. The Frigidaire was a marvel back in its day, but had only five cubic feet of storage. As such, it would be classed as a “mini-fridge” today.

Today, the standard Whirlpool French door refrigerator holds 25 cubic feet’s worth of food and drink. It has “fingerprint resistant stainless steel” and costs just $1,529. According to the latest BLS statistics, it would take the average American just 57.5 hours of work to be able to afford this – now common – appliance. (The average wage today is $26.55 per hour.) Even as the price of refrigerators decreased, refrigerator quality increased. According to the government data, 95.5 percent of households have what is classed as a “medium” refrigerator of 15 cubic feet or larger – meaning that the vast majority of people have a refrigerator at least three times the size of the most luxurious version available 100 years ago. The modern refrigerators have more settings, are more reliable and more energy-efficient.

The story of refrigeration is a common one: from a task done by many servants, to a luxury good, and to now a common household appliance used by all. This type of progress exists with nearly all household appliances; from ovens to irons, from washing machines to dishwashers, and from air conditioners to water heaters.

As Marian L Tupy of the Cato Institute has previously pointed out, due to innovation, capitalism and mass production, “an ordinary person today lives better than most kings of yesteryear.” As we wait for the warm weather to return, we should be thankful that virtually all Americans have access to refrigeration and, thus, the ability to store food all year round.

This first appeared in CapX.

Blog Post | Adoption of Technology

Cooking: from Full-Time Job to Hobby

The world is spending less and less time in the kitchen.

A wealthy Manhattan woman died after her clothes caught fire while cooking last week. Her tragic death was unusual, but there was a time when cooking was far more dangerous and time-consuming. Even today, more than 4 million people lacking modern stoves die prematurely each year from breathing in cooking fumes. Not only was cooking once unsafe, it left time for little else.

As Professor Deirdre McCloskey once noted, “[in] 1900 a typical American household of the middle class would spend 44 hours [a week] in food preparation,” and most of that work fell to women. In other words, back in the days of churning one’s own butter and baking one’s own bread, food preparation took up the same hours as a full-time job. That estimate includes time spent on purchasing, cooking and serving food as well as dishwashing. Keep in mind that in addition to cooking, women were also often responsible for cleaning the home, laundry, mending clothes, and tending to children.

Things started changing quickly. In 1910, U.S. households spent approximately six hours daily cooking meals, including cleanup; by the mid-1960s (when more reliable estimates began), that fell to one and a half hours. By 2008, the average low-income American spent just over an hour on food preparation each day and the average high-income American spent slightly less than an hour on food preparation daily. Disaggregating the data by gender reveals even more progress for women. In the United States, from the mid-1960s to 2008, women more than halved the amount of time they spent on food preparation (whereas men nearly doubled the time they spent on that activity, as household labor distributions became more equitable between the genders).

Mass production of everyday foodstuffs helped transform how women spent their time. In 1890, 90 percent of American women baked their own bread. Factory-baked, pre-sliced bread debuted in 1928. By 1965, 78 out of every 100 pounds of flour a U.S. woman brought into her kitchen came in the form of baked bread or some other ready-prepared good. Today, baking bread is an amusement for foodies, rather than a necessary chore for all women.

Over time, markets brought about and lowered the cost of such innovations as microwaves, convection ovens, ranges, grills, toasters, blenders, food processors, slow-cookers and other labor-saving kitchen devices. Markets have even produced grocery delivery services that bring food to one’s door with the touch of an application on a smartphone. Market processes also lowered the cost of dining out, and today Americans spend more dining out than eating in.

The liberation of women from the kitchen is ongoing, as technological devices and mass-produced goods spread to new parts of the world. Globally, as many as 55 percent of households still cook entirely from raw ingredients at least once a week. A 2015 survey found that average hours spent cooking among those who regularly cook are as high as 13.2 hours per week in India, and 8.3 in Indonesia, compared to 5.9 in the United States.

The gap in time spent on food preparation between rich and poor countries remains wide. But even in India — the poorest country surveyed, and the one with the highest reported average food preparation hours — women devote almost 31 fewer hours to food preparation per week than U.S. households did in 1900. Even allowing for compatibility problems when comparing those figures (the estimate for 1900 was for the household and included meal cleanup time), the sheer size of this difference suggests some improvement.

Much room for progress remains. In 2016, only 0.6 percent of Chinese households and 0.1 percent of Indian households had a dishwasher, compared to 67 percent of U.S. households, according to Euromonitor data. In 2016, microwave market penetration was just 23.4 of Chinese households and 3.1 percent of Indian households, compared to 91.3 percent of U.S. households. Only 15 percent of Indian households owned a refrigerator in 2006.

If prosperity continues to spread and poverty to decline globally, kitchen appliances and ready-made goods will free up more and more hours of women’s food preparation time around the world. There may always be freak accidents like the one in Manhattan, but there is no reason why innovation cannot lessen the risk by liberating women everywhere from kitchen chores.

This first appeared in the American Spectator.

Blog Post | Adoption of Technology

Markets Are Setting Washerwomen Free

The greatest invention of the industrial revolution...

Has anything changed the world more than the internet? South Korean economist Ha-Joon Chang thinks so. He would argue that one invention – an engine of liberation – has had a far more powerful effect on daily lives. He means the washing machine, of course, which the late Hans Rosling called the greatest invention of the industrial revolution. It freed women from the chore of laundry – or at least from spending one full day a week every week doing it.

As a result, Americans now lose less than two hours a week to the task, and today a greater proportion of poor US households own washing machines than average American households did back in the 1970s. While washing machines are far from being the only reason that women’s options have multiplied in the West, they have certainly helped. “Without the washing machine,” claims Chang, “the scale of change in the role of women in society and in family dynamics would not have been nearly as dramatic.”

Source: Econweb and BLS

The change is ongoing. Thanks to economic growth and rapidly declining global poverty, more women own or have access to washing machines than ever before. Even so, one 2013 study estimated that, in 2010, 46.9 per cent of households worldwide owned one. That means the market for washing machines has significant room to grow – and that there is a vast amount of latent human potential still out there, yet to be unleashed.

Take China, home to the greatest escape from poverty of all time, when economic liberalization freed hundreds of millions from penury. The economy (measured in 2014 US  dollars and adjusted for differences in purchasing power) grew 31-fold between 1978, when the country abandoned communist economic policies, and 2016.

In 1981, less than 10 per cent of urban Chinese households had a washing machine (as approximated by the number of sets per hundred households). But by 2011, 97.05 per cent did. In 1985, less than 5 per cent of rural Chinese households had a washing machine, partly because of the expense, but also because they lacked access to electricity. By 2011, 62.57 per cent owned a machine. Thus possession of a washing machine is a useful indicator, not only of China’s tremendous progress, but of the narrowing gap between rural and urban areas.

Source: Laili Wang, Xuemei Ding, Rui Huang and Xiongying Wu, “Choices and using of washing machines in Chinese households,” International Journal of Consumer Studies (38) 2014, pp. 104-109.

It’s a slightly different story in India, where liberalizing economic reforms didn’t begin until 1992, rather later than in China. From 1992 to 2016, India’s economy grew four-fold. Only 11 per cent of Indian households owned a washing machine in 2016.

As with China, urban households are better off, with machine ownership now topping 20 per cent in the most populous cities. That means many women still do the laundry by hand, pounding and scrubbing for hours, in some cases with no running water. Nonetheless, movement is in the right direction. As India’s economy grows and poverty declines, more women will be able to ditch the dirty washing.

We have come a long way since Bendix Home Appliances patented the first automatic washing machine for domestic use in 1937. As a Bendix ad in Life magazine put it in 1950, “washday slavery became obsolete in just 13 years” for American women. In 2007, Panasonic launched laundry machines with a sterilization mechanism designed specifically to address Chinese consumers’ priorities and successfully increased its market share in the country.

It is important to note what is at the root of this progress. Not only has competition and the profit motive incentivized the washing machine’s invention, it is the capitalist drive that is ensuring ongoing marketing to new customers in developing countries. Innovation stagnates under socialist systems, but capitalism has created more life-transforming innovations than any other economic system and sown the greatest rise in living standards in history.

Africa remains the continent with the worst record on economic freedom, as well as being the poorest continent with the least access to time-saving technologies. But even in Africa, the vicious cycle is breaking and capitalism is slowly helping to alleviate poverty. Washing machine ownership might be low, but most Africans are optimistic about their economic future and possibilities.

Thus today, washing machines are still doing the work they were doing 80 years ago – which isn’t just cleaning clothes. These juddering boxes are life-transforming technologies that allow women to put their time and labor to more constructive use. And as ownership sweeps across the world, we can also track the progress of economic freedom.

This first appeared in CapX.