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Comment Misleading Graph (Score 1) 544

It is misleading to graph Real Productivity vs. Real Income.
The BLS uses different notions of inflation for Productivity vs. Household Income.
There is no absolute notion of inflation. Inflation depends on the basket of goods tracked. The basket of goods is very different for the sort of consumer items households purchase vs. the sort of items relevant to business costs.
The Consumer Price Index(CPI) has undergone significantly more inflation than the Implicit Price Deflator for the Nonfarm Business Sector(IPDNBS). A significant portion of the divergence in the graphs in the article is simply a reflection of this difference in inflation.
Here is a nice pdf from the BLS showcasing these issues: http://www.bls.gov/opub/mlr/2011/01/art3full.pdf

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