That's a nice story.<p>The real reason was the US dollar was on a gold standard during that period of time. In the late 50's to 60's the US begin to issue more currency than their gold holdings were increasing, leading the countries like France withdrawing gold from the US (and apparently, inflation, according to this article), and finally the dissolution of the gold standard in 1971.<p>Since the US dollar was fixed to gold there was little to no inflation, because the ratio of gold price to goods price is much more stable.<p>In 1950 - A coke was 5c, median household income $4000[1] per year = 80000 cokes per year.<p>In 2015 - A coke is $2[2], median household income $50500[3] per year = 25000 cokes per year.<p>In real terms adjusted by the price of coke, the median household income has fallen by 69%. (for giggles).<p>1. <a href="http://web.stanford.edu/class/polisci120a/immigration/Median%20Household%20Income.pdf" rel="nofollow">http://web.stanford.edu/class/polisci120a/immigration/Median...</a><p>2. <a href="http://www.humuch.com/prices/CocaCola-Bottle-20oz500ml/______/40#.VZDGuO2qqko" rel="nofollow">http://www.humuch.com/prices/CocaCola-Bottle-20oz500ml/_____...</a><p>3. <a href="http://www.mybudget360.com/how-much-do-americans-earn-what-is-the-average-us-income/" rel="nofollow">http://www.mybudget360.com/how-much-do-americans-earn-what-i...</a>
When people bemoan how things were cheaper back in an earlier time, they are often forgetting to take into account:<p>CPI Inflation (when adjusted for inflation, these 'cheap' things are often as expensive as they are today) this is seen with the movie ticket example <a href="http://greyenlightenment.com/debunking-the-gold-standard/" rel="nofollow">http://greyenlightenment.com/debunking-the-gold-standard/</a> Maybe some things are a little more expensive, but it pretty much all evens-out.<p>Improved Utility (you get a better product despite the higher nominal price)<p>New products (your dollar buys things that didn't even exist even as early as generation ago)<p>Expenditures such as food & energy constitutes a smaller percentage of income than generations ago.
Even Pepsi had a jingle based on the nickel price for a 6oz bottle of Coca-Cola:<p><i>Pepsi-Cola hits the spot, 12 full ounces, that’s a lot, Twice as much for a nickel too, Pepsi-Cola is the Drink for you!</i>
Awesome story. I wonder if the same kind of things have happened for other brands. Coke was also pretty clever advertising 5 cents a bottle to lock the price, brilliant plan to neutralize a bad move in the past.
> <i>At one point, the head of Coca-Cola asked President Eisenhower for help. (They were hunting buddies.)</i><p>That line tells you everything you need to know about how big business gets what it wants from government.
I wonder... what would have happened if they fixed the price at 1c, forcing the bottlers out of business, then renegotiated the contract i.e. void the contract and we'll stop advertising it as 1c. The fountain stuff could have kept Coke in business then it is a war of attrition?