$100 in 1920 is worth $70.00 in 1940,
because prices declined 30.0% over that period, an average of
1.77% a year.
$100 in 1920 has
the same buying power as
$70.00
in 1940
Detailed inflation statistics
Cumulative price change
-30.0%
Average inflation rate
-1.77% per year
Converted amount ($100 base)
$70.00
Price difference ($100 base)
-$30.00
CPI in 1920
20
CPI in 1940
14
Inflation in 1920
15.61%
Inflation in 1940
0.72%
$100 in 1920 → 1940
$70.00
$100 in 1940 → 1920
$143
What happened to prices between 1920 and 1940
Between 1920 and 1940, the Consumer Price Index went from 20 to 14.
Cumulatively, prices declined 30.0%, which works out to an average of
-1.77% per year. Put differently, a dollar in 1920 bought what
$1.43 buys in 1940: the 1920 dollar
gained 42.9% in purchasing power over
these 20 years.
1920 was the last year of the inflation that had built since the war began:
consumer prices rose 15.6% for the year, leaving the CPI more than double its
1913 starting level after seven straight years of increases.
The boom behind those increases turned to bust before the year was over. The
Federal Reserve, worried about speculation, pushed its discount rate to a
record 7% that spring, and wholesale prices, which had led the wartime
runup, began collapsing within months. The National Bureau of Economic
Research dates the resulting downturn from January 1920 to July 1921, one of
the shortest but steepest contractions in U.S. history, and consumer prices
followed into outright decline, falling 10.5% in 1921. Two constitutional
changes reshaped the country that year, too. The 18th Amendment’s ban on
alcohol took legal effect January 17, enforced under the Volstead Act
Congress had passed the previous October. Then, on August 18, Tennessee’s
ratification of the 19th Amendment secured women’s right to vote nationwide,
and women cast ballots in a presidential election for the first time that
November, when Warren Harding won on a promise to return the country to
“normalcy” after a decade of war, pandemic, and rising prices. First-class
postage held at 2 cents, unchanged since mid-1919.
Every 1920 amount converts to 1940 at the same ratio, 0.70: $1,000 becomes
$700, and $10,000 becomes $7,000.
Amount in 1920
Value in 1940
$1.00
$0.70
$5.00
$3.50
$10.00
$7.00
$20.00
$14.00
$50.00
$35.00
$100
$70.00
$500
$350
$1,000
$700
$5,000
$3,500
$10,000
$7,000
$100,000
$70,000
$1,000,000
$700,000
Inflation by spending category, 1920–1940
Every category fell between 1920 and 1940: apparel the most, down 49.4%, and food the least, down 42.9%. The headline number is an average; here is what $100 of 1920
spending costs in 1940, by category:
Category
Avg. yearly inflation
$100 in 1920 →
All items (CPI-U)
-1.77%
$70.00
Food
-2.76%
$57.14
Apparel
-3.35%
$50.58
Not shown because the BLS began these indexes after 1920: core (all items less food & energy) (1957–), energy (1957–), housing (1967–), medical care (1935–), transportation (1935–), recreation (1993–), education & communication (1993–).
Decade by decade: 1920 to 1940
Prices fell throughout this span: most slowly in the 1930s (1.7% a year) and fastest in the 1920s (1.8% a year). Each step below chains into the full 1920–1940 change:
Years
Avg. yearly inflation
Price change
$100 from 1920, at end
1920–1930
-1.79%
-16.5%
$83.50
1930–1940
-1.75%
-16.2%
$70.00
Year by year: CPI and the value of $100 from 1920
$100 from 1920 had already become $83.50 by
1930, on its way to $70.00 in 1940; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 3.6% in 1937, and prices fell 10.5% in 1921, the deepest deflation of the period.
In 1940, prices rose 0.7% and $100 from 1920 had the buying
power of $70.00; the year's average CPI of 14 is the level
behind every 1940 figure on this page.
Consumer prices rose 0.7% in 1940, snapping 1939’s decline
and marking the first increase since 1937. The gain was modest, and the CPI
still stood 18.1% below its 1929 peak, a reminder of how far
the recovery from the Depression’s trough had left to go even as defense
orders from Britain and France began reaching American factories. War was
already reshaping domestic policy well before it touched American soil.
Congress passed the Selective Training and Service Act that September, the
country’s first peacetime draft, requiring men aged 21 to 35 to register and
authorizing the induction of up to 900,000 men a year, more than a year
before Pearl Harbor. That November, Franklin Roosevelt won an unprecedented
third term, defeating Republican Wendell Willkie after campaigning on
keeping the United States out of the war then consuming Europe and Asia. The
promise would not hold much longer: within two years, wartime demand would
push consumer prices up faster than at any point since the aftermath of
World War I. First-class postage held at 3 cents, and the federal minimum
wage stayed at 30 cents an hour, the level set the previous October under
the Fair Labor Standards Act.
MLA: “Inflation from 1920 to 1940: $100 is worth $70.00 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1920-to-1940/
APA: InflationCalculator.com. Inflation from 1920 to 1940. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1920-to-1940/