Reply To: Prices of Services and Economic Growth


I’m having a little trouble understanding the first part of the second sentence (“If money’s purchasing power is falling because of increased production of goods,”). I was under the impression that increased production of goods would increase money’s purchasing power.

And in the third sentence, “So even if wages for labor services decline during economic progress,” we are talking in nominal terms, correct? So, in terms of paying for services that can’t currently be replaced by capital goods (such as massages), we would see a decrease in the monetary price but an increase in the real price of the service?