What can Christmas dinner tell us about inflation?

Digital microdata reveal nuance in the price of the holiday season’s most important meal, while historical records highlight how the cost of key ingredients has changed over decades.

The typical Christmas dinner is set to cost between £26 and £36 a head this year depending on where you buy your turkey, sprouts, spuds and so on. That's according to the BBC, but the whole media is awash with such stories this week. Kantar's estimate of precisely £32.57 features in The Guardian; the Financial Times says that costs have risen 20% since the pandemic; while The Sun is promoting offers for all the Christmas vegetables you need for just 15 pence.

Analysts and media outlets are coming to these varied conclusions by making different assumptions. No two Christmas dinners are alike. The choice of meat (or not), the range of vegetables, the type of stuffing and the volume of gravy to cover it all matter.

The exact accounting for one Christmas dinner may seem trivial, but the composition of price statistics is important – this is how inflation and therefore the cost of living are calculated. Statistical agencies like the UK’s Office for National Statistics (ONS) try to build a basket of goods and services that best represents the population's consumption. If the selection of products is unrepresentative, so too will be the inflation figures reported.

The ONS tweaks the composition of its consumer prices index (CPI) basket each year, adding and removing items to reflect more accurately where money is spent. For example, 2024 saw the addition of a new British fixation, the air fryer (stretching even to full air fried Christmas dinners) and the return of vinyl records after over 30 years. Conversely, rotisserie chicken and hand sanitiser are now gone, the latter’s removal perhaps a symbol of pandemic habits beginning to fade.

Rather than dictate what should and should not feature in the ‘reference’ Christmas dinner, the Economics Observatory’s visualisation in this article empowers readers to decide for themselves. Our default spread is more lavish than some, featuring a generous serving of sparkling wine, but the exact composition is customisable. Fancy a teetotal Christmas or expensive champagne? Want to forgo all meat or load up on pigs in blankets? Try customising the menu in Figure 1 to work out the cost of your Christmas dinner.

Figure 1: The cost of a Christmas dinner (interactive)

Source: Author’s calculations; prices collected in the second week of December 2024.

This tool uses data collected from six of the UK's largest supermarkets. While this represents our best effort at price comparison, the exact cost of a Christmas shop will depend on the specific products chosen and the offers available on the day. The visualisation should not be considered a comprehensive shopping guide.

But what about Christmas dinners past?

How has the price of a Christmas dinner changed over time?

At the end of Charles Dickens' A Christmas Carol, a reformed Ebenezer Scrooge offers a local boy half a crown to fetch the prize turkey from the local butchers. According to the Bank of England, this reward (equivalent to 12.5 pence after decimalisation in 1971) is worth around £13 in today's money.

Information like this can liven up and contextualise analysis of the economy. French economist Thomas Piketty, for example, brings his Capital in the Twenty-First Century to life with excerpts from Dickens as well as Jane Austen and Honoré de Balzac. But for a firmer grasp on economic history, official price records provide more concrete data.

Statistics agencies like the ONS meticulously collect millions of prices a year. Unfortunately, these data do not stretch back to the days of Scrooge's haunting. But with this price microdata, we can take a good look at prices over the last few decades.

Many of the Christmas staples – sprouts, stuffing and turkey – are too seasonal or too niche to be included in the ONS basket of goods. Instead, we can look at a few proxies: chicken, fortified wine and potatoes.

Figure 2: Price distributions for fortified wine, chicken and potatoes

Source: Davies, 2021; author’s calculations
Note: Note: Deciles shaded

The costs of these three goods have evolved in quite different ways (see Figure 2). Since 1988, the median price for a bottle of fortified wine has almost quadrupled from £3.60 to £13.25. Conversely, the price of chicken has increased by a more modest 86%. Potatoes, on the other hand, are marginally cheaper now than they were 20 years ago when the data began.

But looking at prices alone conceals half the story. As most goods and services become more expensive, wages have tended to rise too. Often, wages will be sensibly adjusted by the overall CPI rate to account for inflation, but for a festive twist, we can express wages in units of chicken, port and roast potatoes (see Figure 3).

Figure 3: Weekly wages, relative to the price of potatoes and port

Source: Davies, 2021; author’s calculations
Note: Weekly wages, divided by the median price for each good in the given month. Assumes an average potato weight of 200g.

Over the last two decades, voracious consumers of potatoes, roasted or otherwise, have fared well. Calculated assuming a 200g potato, the average weekly earnings of a UK worker are equivalent to almost 4,500 potatoes. Meanwhile, workers can afford about 15% less port for their labour today compared with 20 years ago.

While comparing Christmas dinners and potato-denominated wages is whimsical, it is a reminder of how inflation affects households across the country in different ways. These divergent price patterns mirror a broader story of inflation inequality, where rising costs affect families differently based on their shopping patterns and income levels.

During the recent cost of living crisis, this disparity has become particularly stark. Research from both the Resolution Foundation and the Institute for Fiscal Studies (IFS) has documented how lower-income households face higher effective inflation rates, driven by price increases for essential goods and steeper inflation for budget products. Just as each family's Christmas dinner varies, so too does their experience of changing prices.