Why does it cost so much

Don't have an account? All Rights Reserved. OSO version 0. University Press Scholarship Online. Sign in. Not registered? Sign up. Publications Pages Publications Pages. Recently viewed 0 Save Search. Users without a subscription are not able to see the full content. Robert B. Archibald and David H. Feldman Abstract College tuition has risen more rapidly than overall inflation for much of the past century, and in recent years this growth has accelerated.

In , the median home value in the U. That's partly why the typical homebuyer is now 44 , whereas in , the typical homebuyer was And it's not much easier to rent. As of June , the annual rise in rental prices was nearly four times the overall inflation rate.

Education is more expensive, too. That makes the cost today almost 17 times as much as in — a markup of more than 1, percent. And as the U. While some prices have risen more drastically than others — and some have even decreased — one thing is clear: The cost of everyday life in is drastically higher than it was in the s or s. But this is not the only reason for their expensiveness. House building is a small-scale industry.

There are thousands of builders in the United States, but few large building organizations. There are none to be compared with such corporations as Ford, General Motors, or Chrysler in the automobile industry, General Electric or Westinghouse in electric machinery, Du Pont in chemicals, and the like. The Bureau of Labor Statistics found in that the average builder of single-family dwellings in 72 cities built only three and a half houses a year.

In fact, even in the largest cities, more than half the builders took out permits to build only one house each inside the city limits. Many of them worked part time as builders and the rest of the time as carpenters, painters, or contractors for other builders. The small-scale size of the industry is also true for apartment builders. Because the average builder is a small operator he cannot get the benefits from large-scale buying of materials or land.

In other industries, such as automobiles, the price of the product has dropped through the years because large corporations produce millions of units of the same article each year. In doing so they use millions of the same parts, mostly made by machines and put together on an assembly line, thus cutting unit costs sharply. In house building, every unit is put together on the site under the direction of a builder or contractor, and most of the work is done by hand.

In house building, however, there is little conclusive evidence of cost reduction for the industry as a whole as a result of major changes in materials or production methods. GI Roundtable Series. Corey Prize Raymond J. Cunningham Prize John H. Klein Prize Waldo G.