4 ms·

Electronics, Fruits or even raw materials, I do think there are a lot of products where import plays a role in the supply chain. A product manufactured in the U

by Sayrus 5y ago

Electronics, Fruits or even raw materials, I do think there are a lot of products where import plays a role in the supply chain. A product manufactured in the UK (I assumed as you used £) might have a price increase if the required materials has now a 2x shipping cost. I think that 70-80% of the food in the UK is imported so I don't think the impact is that negligible. While most of the money is spent on local things as you said, if after housing / healthcare / education / ... you are left with a fixed amount of money to buy groceries, a 50% price increase is huge on your QoL and purchasing power.

fpoling 5y ago
There was a study in Denmark that showed that only about 20% of a price one pays in the supermarket went to producers of the food and like 10% was spent on transport. 25% were taxes, 25% was spent on advertisements, the rest was the shop take to pay workers, location rent and the profit. I doubt in UK it is much different. So if the transportation will be twice expensive, it will translate into price increase only of 10%.
- sofixa 5y ago
  > So if the transportation will be twice expensive, it will translate into price increase only of 10%. Which can lead to riots. Imagine the worst off, the people making minimum wage and similar, who see their food increase in price 10% across the board. The spark for the Yellow Vests in France movement was a small increase in taxes on fuel : `tax increase had been 7.6 cents per litre on diesel and 3.9 cents on petrol in 2018, with a further increase of 6.5 cents on diesel and 2.9 cents on petrol planned for 1 January 2019` Those protests raged for more than a year, and were stopped only by the pandemic, and caused billions of euros of various damage and have left multiple people dead and wounded. And fuel, as vital as it might be in rural areas to move, is significantly less important than food which even people who can move around on bike or public transit need to survive.
  - ClumsyPilot 5y ago
    "Imagine the worst off, the people making minimum wage and similar, who see their food increase in price 10%" By that logic there should have been a civil war after 2008. The changes proposed would provide jobs to the worst off, that's a fairly reasonable trade, which you may or may not be inclined to take
  - fpoling 5y ago
    Notice how 25% of price is spent on various forms of advertisement. Most owners of supermarkets are not stupid. If they see that they cannot pass fully transportation price increase directly to consumers they may cut advertising budgets.
iso1631 5y ago
The cost of housing is mainly in the cost of renting the land from a landowner (or the cost of paying the mortgage having bought the land). That is linked to the amount people can spend. If other things increase in price, people have less money to spend on housing, rents go down, which leads to house prices going down.
- ClumsyPilot 5y ago
  Your economic model seems to boil down to "all money that can be spared flows to landowners"
  - concordDance 5y ago
    That's roughly how it works in the South East of England. London has the worst [years of wages] for 1 square meter of housing ratio in the world. Excluding Hong Kong.
ben_w 5y ago
> I think that 70-80% of the food in the UK is imported so I don't think the impact is that negligible. The percentage sounds about right, but in money that’s £11.5 bn out of a £2038 bn GDP. https://www.gov.uk/government/statistics/food-statistics-pocketbook/food-statistics-in-your-pocket-global-and-uk-supply https://www.gov.uk/government/statistics/food-statistics-poc... https://www.wolframalpha.com/input/?i=uk+gdp+in+GBP https://www.wolframalpha.com/input/?i=uk+gdp+in+GBP That said, Brexit is a live demo for many of these issues.

by Sayrus 5y ago

fpoling 5y ago

There was a study in Denmark that showed that only about 20% of a price one pays in the supermarket went to producers of the food and like 10% was spent on transport. 25% were taxes, 25% was spent on advertisements, the rest was the shop take to pay workers, location rent and the profit. I doubt in UK it is much different. So if the transportation will be twice expensive, it will translate into price increase only of 10%.

sofixa 5y ago
> So if the transportation will be twice expensive, it will translate into price increase only of 10%. Which can lead to riots. Imagine the worst off, the people making minimum wage and similar, who see their food increase in price 10% across the board. The spark for the Yellow Vests in France movement was a small increase in taxes on fuel : `tax increase had been 7.6 cents per litre on diesel and 3.9 cents on petrol in 2018, with a further increase of 6.5 cents on diesel and 2.9 cents on petrol planned for 1 January 2019` Those protests raged for more than a year, and were stopped only by the pandemic, and caused billions of euros of various damage and have left multiple people dead and wounded. And fuel, as vital as it might be in rural areas to move, is significantly less important than food which even people who can move around on bike or public transit need to survive.
- ClumsyPilot 5y ago
  "Imagine the worst off, the people making minimum wage and similar, who see their food increase in price 10%" By that logic there should have been a civil war after 2008. The changes proposed would provide jobs to the worst off, that's a fairly reasonable trade, which you may or may not be inclined to take
- fpoling 5y ago
  Notice how 25% of price is spent on various forms of advertisement. Most owners of supermarkets are not stupid. If they see that they cannot pass fully transportation price increase directly to consumers they may cut advertising budgets.

iso1631 5y ago

The cost of housing is mainly in the cost of renting the land from a landowner (or the cost of paying the mortgage having bought the land). That is linked to the amount people can spend. If other things increase in price, people have less money to spend on housing, rents go down, which leads to house prices going down.

ClumsyPilot 5y ago
Your economic model seems to boil down to "all money that can be spared flows to landowners"
- concordDance 5y ago
  That's roughly how it works in the South East of England. London has the worst [years of wages] for 1 square meter of housing ratio in the world. Excluding Hong Kong.

ben_w 5y ago

> I think that 70-80% of the food in the UK is imported so I don't think the impact is that negligible. The percentage sounds about right, but in money that’s £11.5 bn out of a £2038 bn GDP. https://www.gov.uk/government/statistics/food-statistics-pocketbook/food-statistics-in-your-pocket-global-and-uk-supply https://www.gov.uk/government/statistics/food-statistics-poc... https://www.wolframalpha.com/input/?i=uk+gdp+in+GBP https://www.wolframalpha.com/input/?i=uk+gdp+in+GBP That said, Brexit is a live demo for many of these issues.