Apple's latest iPhone costs almost $2,000, with a top-of-the-range version retailing at more than $3,000, according to MoneyWeek. The first iPhone, launched in 2007, cost $499 — about $800 in today's money — meaning a flashy new Apple device has almost doubled in price in real terms over two decades.
The trend is not limited to phones. Glastonbury Festival tickets for next year will cost £408, compared with £87 in 2000, or £170 in today's money. Chanel's signature handbag has risen fivefold in price over the past two decades, while a Rolex Submariner has more than doubled in real terms.
Such goods signal status as well as performing a function, and companies push prices higher to maintain exclusivity, MoneyWeek reported. Rising global wealth is also a factor: the number of millionaires has roughly doubled from about 30 million a decade ago to roughly 60 million now, according to the UBS Wealth Report.
The article warned that if high-status goods become less affordable, the divide between a tiny minority who can still afford them and everyone else will widen, leaving the latter feeling alienated from a free-market economy. It suggested iFlation could eventually create a backlash, with calls for wealth taxes and caps on corporate profits becoming louder.