After having chosen this TV model, he decided to look at its price in one of the most important technological products shops in Italy: MEDIAWORLD (this shop is usually considered - by Italians - a convenient shop for prices and quality!!).
The price for that model at Mediaworld was 3997 euro
http://compraonline.mediaworld.it/webapp/wcs/stores/servlet/ProductDisplay?catalogId=20000&storeId=20000&productId=446258&langId=-1&category_rn=13951 .
Then, considering the price too much elevate, he went on the web looking for a lower price from an italian on-line shop. The lowest on-line price, he was able to find, was from www.onlinestore.it.
The price was 3194 euro
http://www.onlinestore.it/product_info.php?products_id=4851
He was really satisfied about this new price (800 euro less!!! However "onlinestore" does not specify where the TV comes from..I mean from which country!! Moreover the buyer can buy this product only on the web and not from a "real" shop), but since my father is really curious, he looked at the price of the same TV model offered abroad by other shops!!
He was really impressed by the differences in price:
England: 2800 euro
http://www.viking-direct.co.uk/catalog/catalogSku.do?id=LC46XD1E&XREF1=IPUK707999FROGLE&XREF2=LC46XD1E&cm_mmc=SC-_-froogle-_-null-_-LC46XD1E&browsemode=consumer
France: 3035, 34 euro
http://www.twenga.fr/prix-LC-46HD1E-SHARP-TV-LCD-181243-0
Switzerland: 2585 euro
http://www.ldlc.ch/fiche/PB00064631.html
Choosing a generic shop from Switzerland, England and France, He was able to find always lower prices than the italian ones for exactly the same product!!!
Then he realized, without being an economist, that something was wrong in Italy..that, probably, in Italy there are some problems of competition between firms!!!
I totally agree with him.
Considering that the demand of technological products in Italy is almost the same of the other countries taken in consideration (I think there are not big diferrences in the aggregate demand for TV between the countries taken in consideration!), these big differences in price should be explained with some form of collusion between technological firms, or, at least, with some monopolstic power of Mediaworld in technological products on the italian market!!!
Even in the last case (a monopolistic power of Mediaworld), it would be interesting to understand what are the reasons of this situation in ITALY.
THEN..WHAT CAN I CONCLUDE? IF YOU WANT TO BUY A TV..IS BETTER TO BUY IT ABROAD..AND NOT IN ITALY!!! EVEN IF I REALLY COMPLAIN TO BUY A PRODUCT FROM A FOREIGN COUNTRY THE ITALIAN SITUATION FORCE ME TO BUY THE TV FROM ONE OF THE FOREIGN SHOPS MY FATHER FOUND ON THE WEB!!
Thanks for the attention
Domenico
3 comments:
How will be competition for goods like these in a time in which a critical number of consumers will choose where to buy from shops settled all over the world (or better, nowhere)? what will happen to prices? to local actors? to other goods' prices, national wages... any breakthrough idea for possible evolutions or revolutions?!
If it will happen what you said and if "the critical number" you intend is the total number of consumers in the world, then the two ideas I have in mind are the following ones:
- if the firms do not make any "world" collusion, then the prices should reach directly the marginal cost - for homogeneous products (and much generically the equilibrium prices studied in noncooperative economic models without collusion)
- if firms would realize a "worldwilde collusion", then the prices should reach the higher equilibrium prices..studied in collusion type models
The problem is always the same: if the informations about prices are clear and ALL the consumers behave in order to get the good at the minimum price offered all around the world (where this can happen only if the informations on prices become free and easy to obtain without spending any searching cost), then the unique problem is how can we prevent tacit collusion between firms: this would be the real problem!!!
ciaoo Domenico
This clearly shows that Italian retailers are inefficient.
As far as I know custom tax and consumer tax is the same in whole EU. The initial price of T.V should be also the same in EU because there no that much transportation cost among countries.
If retailer pay more wages to workers or pay more money for regional tax or for insurance of employees then they need to sell the same TV with higher prices else the "Law of one price" in international trade was going to be hold.
One more thing comes to my mind: Maybe there is a T.V mafia in Italy!! I think you can find out how that works out!
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