Money problems with conversion factors


Status
Not open for further replies.
M

mike disch

Guest
Earlier posts re conversion rate gave $4.79 (call it $5.00) per Pound Sterling in 1912, and books comparing 1912 w/current (including Titanica exhibits) use multipliers of about 17.5 (call it 18). But my calcs, using ticket prices given on this website, give results radically different from what the books and signs say. One of us is messed up. Help. For example.
For Molly Brown, her FIrst Class ticket price per this website) is 28# (my symbol here), x $5. = $140 in 1912, or about $2.500 TODAY. Most signs say a 1st class tiket cost about $2,500 THEN, and $48,000 today.
I did the same calcs for other 1st, 2nd and 3rd class passengers, and get the same kind of gross discrepancy.
So, am I doing something stupid, or is everyone else multiplying by 18 twice?
 

Bob Godfrey

Member
Nov 22, 2002
6,043
107
333
UK
Mike, your method of calculation is broadly correct. Considered purely in terms of changing purchasing power of the dollar, Molly's ticket would cost about $2100 dollars today. There are, however, other forms of conversion which make allowance for the changing impact of a given amount of spending, taking into account the fact that average incomes have increased at a rate far higher than that of price inflation. Using such a conversion method, it is possible to generate a figure as high as $40,000. On the other hand, some people do just screw up the conversion exactly as you have suggested. I agree the situation is VERY confusing!
 

Bob Godfrey

Member
Nov 22, 2002
6,043
107
333
UK
You might try playing with the variety of online calculators on this webpage:


GDP per capita is probably the most realistic comparison factor if you want to allow for increased living standards. This would generate a 'modern' price for Molly's First Class ticket of $14000. In other words, it would take you as long to earn that amount of money as it would have taken your 1912 counterpart to earn the 1912 price.
 
Jun 4, 2000
1,286
6
313
Bob - thanks! That was the site I used last time this sort of discussion came up. Sadly, it was dead the day I checked recently and I thought it gone forever. Now I see its time out of cyberspace was only temporary: excellent news.
happy.gif


Pardon me while I happily trot off to play with it some more.
 

Bob Godfrey

Member
Nov 22, 2002
6,043
107
333
UK
Glad to be of assistance, Fiona. American members might find it useful when considering the impact of 1912 prices to half the figure in pounds and then add three noughts. Thus the time and effort required in 1912 to earn about 7 UK pounds for a 3rd Class ticket would be the equivalent (very roughly) of earning 3,500 US dollars today. A 2nd Class ticket would be roughly twice that amount, and the cheapest 1st Class ticket about twice as much again as 2nd Class.

By the same reasoning, anybody wishing to build the Titanic today would need to spend something like 750 million dollars to feel the impact as did the shareholders in 1912 who put up just 1.5 million pounds.
 
Status
Not open for further replies.

Similar threads

Similar threads