Hmmm...these cookies look a lot smaller than you remember, when you were a kid. Maybe that’s because you’re bigger now?
Nope. It’s shrinkflation. Don’t let it fool you; you have a right to know what’s going on with your cookies.
Shrinkflation is when a company reduces the size of a product little by little, keeping the price all the same. Your cookies got smaller and smaller and smaller; they hoped people wouldn’t notice, and still buy. In the view of the cookie company, shrinkflation is better than raising the price of the cookies and losing a bunch of customers to substitute goods, like other cookies, or heaven-forbid...ice cream.
Some companies take shrinkflation to the next level. Here’s what they do: they keep prices stable, slowly shrinking what’s inside bit by bit…until one day, they bump up the price a tad, and increase the size of the product to the original size it was before shrinkage. The package will say something like “50% MORE COOKIE INSIDE!” to justify the tiny price increase.
That volume increase is kind of a lie, kind of not. Sure, it's 50% more cookies than last week, but it’s not 50% more cookies than a few months ago. It’s the same amount of cookies as a few months ago.
Now you know: most packaged food and drink products around you are likely to be shrinking in size. Are Oreos really double-stuf'd? Something to ponder.
Related or Semi-related Video
Finance: What is Disinflation?4 Views
finance a la shmoop what is disinflation disinflation often confused with dat
inflation refers to the decline in inflation rates over time in 1973
America was fully juiced with Warbucks from Vietnam inflation hovered around [soldiers firing weapons]
the mid going on high single digits and then higher from there like 7% or more
depending on where you look him and Jimmy Carter stepped in on this guy and [Carter walks into office]
raised the federal rates the Fed rates their massively stamping out the wild
bull economy and putting the brakes on inflation but it didn't happen until
after Carter was actually out of office and Reagan took over inflation [Reagan replaces Carter in office]
eventually had rocketed all the way up to about 14 ish percent on an annualized
basis looking at the monthlies in the 1980-81 period right here
well the crux of dis inflation is that inflation is still positive it's just
becoming well less positive and or like you know how you feel not long after you
say I do and the honeymoon is over and you have to take out the garbage so
under Carter the US inflation rates were attacked in a variety of ways the [Carter in a boxing ring]
biggest of which was to make the cost of renting capital very expensive which
cooled the economy but it took a long time like note how slowly inflation
rates came down and well really it was decades before things fully stabilized
you can see how things slowly disinflation the raging levels that
peaked at post-vietnam era 1314 percent then slid all the way down to a 1 to 3
percent way down there where it's hovered for a
while so that's disinflation still inflation but just less of it deflation [Disinflation deflating]
is when inflation turns negative like prices are actually declining and yes
we've had periods of deflation before albeit very short ones like in the post
mortgage crisis Mallove's in 2009 right here yes yes it's rare but it happens
got it okay class dismissed
Up Next
What is inflation and how does it work? Inflation is the gradual increase in prices over time. You might today pay 100x for the commodity coffee wh...
What are Real Interest Rates and Inflation Correction? Real interest rates are interest rates that have accounted for inflation, so they shouldn’...