Costco Combo Abundance and Stock Appreciation

In 1985 you could have bought a combo for $1.50 or a share of stock for $1.67. Since then the combo is 3 to 7 times more abundant while the stock has increased over 40,000 percent.

Costco introduced their Hot Dog and Soda combination in 1985 for $1.50. The price has not changed in 38 years. Meanwhile, according to measuringworth.com, nominal hourly wage rates for unskilled labor increased 218 percent from $5.18 per hour to around $16.51 today. Blue-collar hourly compensation (wages and benefits) increased 192 percent from $12.50 an hour to $36.50.

Most people begin as unskilled workers and move up to blue-collar workers or better. We call this “upskilling.” If you started out in 1985 as an unskilled worker and over the years became a blue-collar worker, your hourly compensation increased 604 percent from $5.18 to $36.50 an hour.

What does this mean for the Costco Hot Dog-Soda Combo abundance? The time price of the Combo fell by 68.6 percent for unskilled workers, 65.8 percent for blue-collar workers, and 85.8 percent for upskilling workers. For the time it took an unskilled worker to earn the money to buy one Combo in 1985, they would get 3.19 in 2023. A Blue-collar worker would get 2.92 Combos, and an upskilling worker would get 7.04 Combos.

Costco went public on December 5, 1985. After adjusting for stock splits, the initial price was around $1.67. Today shares are selling for around $671. If you had invested $1,000 in Costco the same year they introduced their $1.50 deal, you would have $401,796, enough to buy 267,864 hot dog and soda combos.

Long live the entrepreneurs at Costco who make our lives so abundant.

We describe the process of transforming scarcities to abundances in our new book, Superabundance, available at Amazon. There has never been a better time to create more life.

Gale Pooley is a Senior Fellow at the Discovery Institute and a board member at Human Progress.