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Last week\\xa0I reviewed\\xa0Alex Tabarrok and Eric Helland\\u2019s\\xa0Why Are The Prices So D*mn High?. On Marginal Revolution, Tabarrok\\xa0wrote:

SSC does have some lingering doubts and points to certain areas where the data isn\\u2019t clear and where we could have been clearer. I think this is inevitable. A lot has happened in the post World War II era. In dealing with very long run trends so much else is going on that answers will never be conclusive. It\\u2019s hard to see the signal in the noise. I think of the Baumol effect as something analogous to global warming. The tides come and go but the sea level is slowly rising

I was pretty disappointed by this comment. T&H\\u2019s book blames cost disease on rising wages in high-productivity sectors, and consequently in education and medicine. My counter is that wages in high productivity sectors, education, and medicine are not actually rising. This doesn\\u2019t seem like an \\u201carea where you could have been clearer\\u201d. This seems like an existential challenge to your theory! Come on!

Since we\\u2019re not getting an iota of help from the authors, we\\u2019re going to have to figure this out ourselves. The points below are based on some comments from the original post and some conversations I had with people afterwards.

1. Median wages, including wages in high-productivty sectors like manufacturing, are not rising

I originally used this chart to demonstrate: