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> Particularly in this instance, wherein we have rich countries offering services at a discounted rate, it's actually hugely beneficial to almost everyone. Thi
by shkkmo 4y ago
> Particularly in this instance, wherein we have rich countries offering services at a discounted rate, it's actually hugely beneficial to almost everyone.
This seems highly debatable in several fronts and likely is dependent on the specific circumstances of each market. In some cases it may function like providing cheap food and clothing, where it can be beneficial in the short term, but often causes mid to long term economic damage to the receiving economy by putting local producers/providers out of business.
Whether beneficial or not, the motivation behind this geographic price fixing is absolutely not fairness, but profit maximization.
While companies are free to charge prices they wish in different countries, I think it is against our self interests to have laws that help enforce this price discrimination. Consumers are already at a power disadvantage here, giving companies more power to charge the highest price they can only worsens that disadvantage.
> PPP is not going to be the driving force for pricing for any company that's sophisticate enough to do this - they will find the right price in France the same way they do in America. The PPP is a secondary measurement.
It was literally cited as the basis for the solution being discussed in TFA. I didn't say that PPP gaming was anything new (which is why I cited old examples) but pointed out that this already existing issue will become larger if the approach described in the article spreads.
> The problem in Argentina is that their leaders are corrupt and a bit dumb. Not an 'index'.
While Argentina is especially bad. Leaders are corrupt and dumb all over the world. However, the behavior I am referencing in Argentina was absolutely directly related to the Big Mac Index since they directly manipulated the price of Big Macs specifically. Their other manipulations of PPP are harder to attribute, but that one is pretty clear.
- jasmer 4y ago", but often causes mid to long term economic damage to the receiving economy by putting local producers/providers out of business." That is something completely different, and has little to do with price discrimination. If the service is materially cheaper as provided by the 'rich country' - well, you say 'companies are out of business' - I say - consumers are getting massive surpluses. They can share those surpluses how they want aka social programs via taxation. Of course, if the rich country is 'dumping' on the poor one to put players out of business, it's a different story. "existing issue will become larger if the approach described in the article spreads." My friend, price discrimination is already universal. There is no need to worry about 'spreading'. Everyone is doing it. They always have. It's only news to small companies who need to grow internationally and to the people that work there. Argentina's manipulation of 'Big Macs' is an example of corruption (and stupidity).