US Inflation from 1973 to 1980
US inflation from 1973 to 1980 was +85.6%. $100 in 1973 had the same purchasing power as $185.59 in 1980 (avg. +9.24%/yr).
$100.00 in 1973 is worth
$185.59
in 1980
+85.6%
+9.24%/yr
How prices changed from 1973 to 1980
| Item | 1973 | 1980 | Change |
|---|---|---|---|
| Gallon of gas | $0.39 | $1.19 | +205% |
| Loaf of bread | $0.28 | $0.51 | +82% |
| New home (median) | $32,500 | $64,600 | +99% |
| Median household income | $12,051 | $21,023 | +74% |
| Movie ticket | $1.77 | $2.69 | +52% |
| Annual college tuition (public) | $399 | $804 | +102% |
What Drove Inflation from 1973 to 1980
The 1970s were dominated by stagflation — the toxic combination of high inflation and stagnant economic growth. Two oil price shocks, in 1973–74 and 1979–80, sent energy costs soaring and drove headline inflation into double digits. The Federal Reserve struggled to respond, and political pressure prevented aggressive tightening until Paul Volcker's appointment in 1979 signaled a new era of serious inflation-fighting.
The 1973 Arab oil embargo sent oil prices quadrupling almost overnight, triggering a global recession and double-digit US inflation simultaneously. A second oil price shock in 1979–80 doubled energy costs again. The toxic combination of high inflation and high unemployment — stagflation — exposed the limits of traditional demand management. Paul Volcker's appointment as Federal Reserve chairman in 1979 marked the turning point, as aggressive rate hikes eventually broke the inflationary spiral.
Understanding the Numbers
Over these 7 years, prices roughly doubled — a total inflation rate of +85.6%. The annualized rate of +9.24% per year was well above the historical average of roughly 3.3% per year.
Compare Other Periods
Starting from 1973:
Ending in 1980: