Video: Steve Horwitz on the Real Cost of Living

Increasing productivity (measured in labor time spent to buy specific goods or services) and widespread technological innovation which has brought about extensive consumer surpluses (non-monetary utility benefits) has brought about better quality of living over 100 years, in spite of the myriad interventions by the government.

Mint.com: World's Most Expensive Cities

We will start 2010 with an interactive graphic from mint.com on the world's most expensive cities...



Budgeting – Mint.com

This from mint.com (bold emphasis mine)

``Which are the world’s most expensive cities? The cities included on this interactive map are from a 2009 study by the UBS, which tracked the ups and downs of various places in the wake of the financial crisis. Many cities have changed ranks, with some cities become more, and others becoming less expensive. Currency devaluations played a a major role in the change of rankings, specifically in regards to emerging market cities. High inflation rates also were a factor, especially in areas such as Caracas, Venezuela (30% per year, for the last three years) When a cursor is placed over each highlighted city, an information window will pop up, showing whether it has become more or less expensive to live in this city than it was last year, as well as last year’s rankings for that city."

My assumption is that the UBS calculations had been based on local currency terms, since inflation would imply the cheapening of the currency relative to foreign exchange, particularly the US dollar. As the above example, Caracas, Venezuela takes a leap to the 12th most expensive from the 40th spot last 2008.