People Throw Out Plastic Cups

Moneybox
A blog about business and economics.
March 28 2012 3:06 PM

People Throw Out Plastic Cups

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Robert Smith and Zoe Chance offer an excellent explanation of the difference between durable goods and nondurable goods, marred by what looks to me like a cheap shot at our nation's hard-working government statisticians:

Some of the distinctions are pretty arbitrary. A wine glass is a durable good, unless it's made of plastic.
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That doesn't seem particularly arbitrary to me. My wine glasses have been with me for years, and I keep reusing them until I drop them and they shatter. But when I lived in a big group house and we threw parties, we'd buy a bunch of plastic cups before people came over and then throw them all out as part of the morning-after cleanup. The plastic/not-plastic line doesn't perfectly track the distinction between disposable and non-disposable drinking equipment, but it seems about as good a choice as you could make under the circumstances.

Probably the most important thing to know about durable goods for our present purposes is that if a bunch of twentysomethings got jobs and moved out of their parents' houses into new apartments, they'd want to stock the apartments with durable goods—beds, chairs, couches, wine glasses, and so forth. In other words, jobs would lead to new durable goods demand would lead to more employment growth.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

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