$100 in 1940 is worth $845 in 1988,
because prices increased 745.0% over that period, an average of
4.55% a year.
$100 in 1940 has
the same buying power as
$845
in 1988
Detailed inflation statistics
Cumulative price change
745.0%
Average inflation rate
4.55% per year
Converted amount ($100 base)
$845
Price difference ($100 base)
$745
CPI in 1940
14
CPI in 1988
118.3
Inflation in 1940
0.72%
Inflation in 1988
4.14%
$100 in 1940 → 1988
$845
$100 in 1988 → 1940
$11.83
What happened to prices between 1940 and 1988
Between 1940 and 1988, the Consumer Price Index went from 14 to 118.3.
Cumulatively, prices increased 745.0%, which works out to an average of
4.55% per year. Put differently, a dollar in 1940 bought what
$0.12 buys in 1988: the 1940 dollar
lost 88.2% of its purchasing power over
these 48 years.
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.
Every 1940 amount converts to 1988 at the same ratio, 8.45: $1,000 becomes
$8,450, and $10,000 becomes $84,500.
Amount in 1940
Value in 1988
$1.00
$8.45
$5.00
$42.25
$10.00
$84.50
$20.00
$169
$50.00
$422
$100
$845
$500
$4,225
$1,000
$8,450
$5,000
$42,250
$10,000
$84,500
$100,000
$845,000
$1,000,000
$8,450,000
Inflation by spending category, 1940–1988
Between 1940 and 1988, medical care rose the most, up 1232.7%, while apparel rose the least, up 429.4%, against 745.0% for all items. The headline number is an average; here is what $100 of 1940
spending costs in 1988, by category:
Category
Avg. yearly inflation
$100 in 1940 →
All items (CPI-U)
4.55%
$845
Medical care
5.54%
$1,333
Food
4.88%
$985
Transportation
4.33%
$765
Apparel
3.53%
$529
Not shown because the BLS began these indexes after 1940: core (all items less food & energy) (1957–), energy (1957–), housing (1967–), recreation (1993–), education & communication (1993–).
Decade by decade: 1940 to 1988
Prices climbed fastest in the 1970s, averaging 7.82% a year, and slowest in the 1950s (2.08% a year). Each step below chains into the full 1940–1988 change:
Years
Avg. yearly inflation
Price change
$100 from 1940, at end
1940–1950
5.58%
72.1%
$172
1950–1960
2.08%
22.8%
$211
1960–1970
2.74%
31.1%
$277
1970–1980
7.82%
112.4%
$589
1980–1988
4.62%
43.6%
$845
Year by year: CPI and the value of $100 from 1940
$100 from 1940 had already become $221 by
1964, on its way to $845 in 1988; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 14.4% in 1947, and prices fell 1.2% in 1949, the deepest deflation of the period.
Long periods are sampled every 2 years; the calculator above covers any pair of years.
The destination year: 1988
In 1988, prices rose 4.1% and $100 from 1940 had the buying
power of $845; the year's average CPI of 118.3 is the level
behind every 1988 figure on this page.
By 1988, the economic expansion that began in the ashes of the 1981-82
recession was in its sixth year, and the Federal Reserve was watching for
signs it had run too long. Inflation rose to 4.1%, up from 3.6% the year
before, while unemployment fell to its lowest level since 1974. Alan
Greenspan’s Fed responded by raising the federal funds rate through the
year, from about 6.5% to 8.5%, trying to cool demand before prices
accelerated the way they had in the 1970s. Households still felt the
difference between this expansion and the last one: gas held near 90 cents
a gallon, almost exactly its 1987 price, and median household income rose
to roughly $27,200. The one price that moved was postage, which rose from
22 to 25 cents in April, the fourth increase of the decade but a far
gentler pace than the string of increases in the late 1970s and early
1980s. In November, Vice President George H.W. Bush won the presidency on
the strength of the expansion, promising in his nomination speech to hold
the line on taxes. Both the boom and that pledge would run into trouble
within two years, as the Fed’s rate increases helped tip the economy toward
the 1990-91 recession.
MLA: “Inflation from 1940 to 1988: $100 is worth $845 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1940-to-1988/
APA: InflationCalculator.com. Inflation from 1940 to 1988. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1940-to-1988/