The New Yorker on cost disease

From The Talk of the Town's Financial Page in this week's The New Yorker comes What Ails Us by James Surowiecki, a really interesting look at deflation, productivity, and Baumol's cost disease.

There are really two American economies: one that's getting more productive and one that's not. In the first — the economy of Dell, Toyota, and Wal-Mart — consumers have grown accustomed to paying less for more. In the second — the economy of Harvard, the Yankees, and Bob's Body Shop — they pay more for the same.

Yup, I really think I'd be a happy economist. Related: View: Why College Costs So Much from the New York Times, April 8, 2001.