$100 in 1974 is worth $240 in 1988,
because prices increased 140.0% over that period, an average of
6.45% a year.
$100 in 1974 has
the same buying power as
$240
in 1988
Detailed inflation statistics
Cumulative price change
140.0%
Average inflation rate
6.45% per year
Converted amount ($100 base)
$240
Price difference ($100 base)
$140
CPI in 1974
49.3
CPI in 1988
118.3
Inflation in 1974
11.04%
Inflation in 1988
4.14%
$100 in 1974 → 1988
$240
$100 in 1988 → 1974
$41.67
What happened to prices between 1974 and 1988
Between 1974 and 1988, the Consumer Price Index went from 49.3 to 118.3.
Cumulatively, prices increased 140.0%, which works out to an average of
6.45% per year. Put differently, a dollar in 1974 bought what
$0.42 buys in 1988: the 1974 dollar
lost 58.3% of its purchasing power over
these 14 years.
1974 was the year the postwar economy broke its old rules. Consumer prices
rose 11.0%, the fastest annual increase since 1947, as the Arab oil embargo
that ran from October 1973 to March 1974 roughly quadrupled the price of
crude oil worldwide. Gasoline, which had averaged 38.5 cents a gallon in
1973, jumped to 53.2 cents, and shortages forced many states into odd-even
rationing at the pump. Nixon’s wage and price controls, in place in some form
since 1971, expired at the end of April, removing the last brake on prices
just as the oil shock hit. Nixon himself resigned in August over Watergate,
and Gerald Ford’s response to inflation, a voluntary “Whip Inflation Now”
campaign built around lapel buttons, became a symbol of how little
conventional politics could do against the problem. Prices kept climbing even
as the economy weakened: a recession that started in November 1973 dragged
on, the Dow fell to a bear-market bottom of 577.60 in December, and
unemployment was already rising toward the 9% it would reach in 1975. The
combination of rising prices and a shrinking economy gave the decade its
name: stagflation.
Every 1974 amount converts to 1988 at the same ratio, 2.40: $1,000 becomes
$2,400, and $10,000 becomes $23,996.
Amount in 1974
Value in 1988
$1.00
$2.40
$5.00
$12.00
$10.00
$24.00
$20.00
$47.99
$50.00
$120
$100
$240
$500
$1,200
$1,000
$2,400
$5,000
$11,998
$10,000
$23,996
$100,000
$239,959
$1,000,000
$2,399,594
Inflation by spending category, 1974–1988
Between 1974 and 1988, medical care rose the most, up 226.9%, while apparel rose the least, up 66.3%, against 140.0% for all items. The headline number is an average; here is what $100 of 1974
spending costs in 1988, by category:
Category
Avg. yearly inflation
$100 in 1974 →
All items (CPI-U)
6.45%
$240
Medical care
8.83%
$327
Housing
7.03%
$259
Core (all items less food & energy)
6.76%
$250
Transportation
6.37%
$237
Energy
6.27%
$234
Food
5.60%
$215
Apparel
3.70%
$166
Not shown because the BLS began these indexes after 1974: recreation (1993–), education & communication (1993–).
Decade by decade: 1974 to 1988
Prices climbed fastest in the 1970s, averaging 8.94% a year, and slowest in the 1980s (4.62% a year). Each step below chains into the full 1974–1988 change:
Years
Avg. yearly inflation
Price change
$100 from 1974, at end
1974–1980
8.94%
67.1%
$167
1980–1988
4.62%
43.6%
$240
Year by year: CPI and the value of $100 from 1974
$100 from 1974 had already become $184 by
1981, on its way to $240 in 1988; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 13.5% in 1980, and the smallest rise was 1.9% in 1986.
In 1988, prices rose 4.1% and $100 from 1974 had the buying
power of $240; 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 1974 to 1988: $100 is worth $240 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1974-to-1988/
APA: InflationCalculator.com. Inflation from 1974 to 1988. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1974-to-1988/