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Why AC is cheap, but AC repair is a luxury - by Alex Danco

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If you live in the United States today, and you accidentally knock a hole in your wall, it’s probably cheaper to buy a flatscreen TV and stick it in front of the hole, compared to hiring a handyman to fix your drywall. (Source: Marc Andreessen.) This seems insane; why? Well, weird things happen to economies when you have huge bursts of productivity that are concentrated in one industry. Obviously, it’s great for that industry, because when the cost of something falls while its quality rises, we usually find a way to consume way more of that thing - creating a huge number of new jobs and new opportunities in this newly productive area. But there’s an interesting spillover effect. The more jobs and opportunities created by the productivity boom, the more wages increase in other industries, who at the end of the day all have to compete in the same labor market. If you can make $30 an hour as a digital freelance marketer (a job that did not exist a generation ago), then you won’t accept le

Why AC is cheap, but AC repair is a luxury The Baumol Effect and Jevons paradox are related Alex Danco Nov 03, 2025 228 31 44 Share | America | Tech | Opinion | Culture | Charts | If you live in the United States today, and you accidentally knock a hole in your wall, it’s probably cheaper to buy a flatscreen TV and stick it in front of the hole, compared to hiring a handyman to fix your drywall. ( Source: Marc Andreessen. ) This seems insane; why? Well, weird things happen to economies when you have huge bursts of productivity that are concentrated in one industry. Obviously, it’s great for th

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