Of 8-Track Tapes and MP3 Players: A Lesson in Economics

Are you old enough to have owned an 8-track tape player? Why don't they make them anymore? Because nobody wants them except as souvenirs. Because much better alternatives, such as MP3 players, exist today.  It's a good thing the government didn't subsidize the 8-track industry, because if it had, we might not have MP3 players today.
I had a 1976 Monte Carlo when I was in high school. The best thing about it (besides the 350 engine and the glass pack mufflers) was its 8-track tape stereo system. I chuckle when I compare that stereo to what I have in my 2007 Mercury Milan today.

In about that same era, our family farming corporation bought a tractor that had a cab on it. I loved to drive that tractor, because I could listen to music inside of the cab while I worked.  I bought a portable 8-track tape player that sat in front of the steering wheel--and whenever I drove that tractor, other than the fact that I had to replace 4 C-cell batteries every few days, I was in music heaven.

Also in my high school days, K-TEL was a big music company. It sold a lot of 8-track tapes--and I bought a lot of them.

They don't make 8-track tapes and players anymore. Does make me sad or angry? No--just nostalgic. Why don't they make 8-track tapes and players anymore? Well, let me just say that I sure wish we'd had MP3 players when I was a kid.

Things really started to change, about the time I started college, with the Sony Walkman.  Those first simple CD players cost something like six hundred bucks. At that point, I was content to drive my Monte Carlo or  carry my portable 8-track player around to get my music fix.  But then as the Walkman became more popular and easy to produce, its price came down. Other companies started making CD players, which caused the price to drop even further. And I eventually bought a Sony Walkman.

Today I have an MP3 player that has the footprint of a slightly over-sized postage stamp. In other words, it is probably somewhere around 10,000 times smaller than my portable 8-track player of long ago. It also can store about a thousand more songs. The acoustic quality of those songs is much better. Whereas with the 8-track player I had to listen to songs #1 through #9 if I wanted to listen to song #10, with my MP3 player, not only can I select in mere seconds the specific song I want to play, I can tell my player to randomly serve up songs from my easily editable music selection.

I clip my MP3 player to the collar of my T-shirt when I go for a run. I couldn't do that with my 8-track tape player. Portable CD players eventually came to have skip protection so that they would still play cleanly when I jogged, but even then it's much nicer to clip a postage stamp to my collar than to carry something around that's almost the size of a dinner plate.

Interestingly, about the only involvement government had in the evolution of music delivery is to stay out of the way. What would it have been like if government had subsidized the 8-track industry? Would we have MP3 players today? No; it's not nearly as likely that we would have gotten that far in our technological evolution. When government subsidizes something, it gets more of that thing at the expense of other things that would have been an improvement.  Government subsidy thus creates "what might have been".

It's hard to see the what might have beens in life, because "what might have been" didn't happen. The evolution of the 8-track player into the postage-stamp-sized MP3 player helps us to be grateful, though, that in at least this case government didn't destroy the "what is" by subsidizing the "what was". One of the main reasons that we have MP3 players today is because government didn't subsidize the 8-track industry yesterday.

Now if I could just get government to subsidize blue tooth headphones that would work with my MP3 player...


  1. Frank, the modern electronics like the mp3 are indeed almost miraculous compared to music delivery of yesterday. Yet no miracle comes about without a cost. Have you heard of conflict minerals? These are used in mp3 players as well.


    If producing these devices so inexpensively comes at such a high cost of human life and local communities, are they still truly marvels? Is the fact that we can contentedly and unknowingly pursue our own self interest without knowing the repercussions of our choices a blind spot of capitalism? Did the tragedy of conflict minerals arise precisely because "about the only involvement government had in the evolution of music delivery is to stay out of the way"? Can we eliminate the abuses caused because of conflict minerals without government involvement?

  2. All technology improvements derive from 2 places - defense department spending and the porn industry. the former is purely governmental and the later has almost NO governmental intrusion (1st amendment).

    Your so loved MP3 player was mostly a government funded creation. from wiki:

    MP3 is an audio-specific format that was designed by the Moving Picture Experts Group (MPEG) as part of its MPEG-1 standard and later extended in MPEG-2 standard. The first MPEG subgroup – Audio group was formed by several teams of engineers at Fraunhofer IIS, University of Hannover, AT&T-Bell Labs, Thomson-Brandt, CCETT, and others.[7] MPEG-1 Audio (MPEG-1 Part 3), which included MPEG-1 Audio Layer I, II and III was approved as a committee draft of ISO/IEC standard in 1991,[8][9] finalised in 1992[10] and published in 1993 (ISO/IEC 11172-3:1993[5]). Backwards compatible MPEG-2 Audio (MPEG-2 Part 3) with additional bit rates and sample rates was published in 1995 (ISO/IEC 13818-3:1995).[6][11]

    Your ability to think there was NO GOVERNMENT funding in the above entities involved in standardization of a lossy compression format is the same reason you choose to believe the ridiculous "jesus was a savior" thing. good luck!


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