Price Discrimination: India and Disney World
The picture of the sign above is a good example of "price discrimination" at an archeological site in India, where citizens of India pay an admission fee of 10 rupees (about 25 cents) and "other citizens" pay $5 (or 250 rupees).
Another example of price discrimination are the many discounts at Disney World that are only available for resident of Florida.
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Back in the days, the Soviet Union was a master at squeezing foreign tourists at absurd rates for museum passes, train tickets, seats and the Bolshoi, you name it. Used to make me mad as H***, especially when I was not just a tourist, but living there and teaching full time.
Question to ponder: In my principles text, I argue that price discrimination often (although perhaps not always) improves market performance. So why does it make me so mad when I run into the real thing?
I saw the same thing in Baalbek in Lebanon - a sign in English announced one price and a sign in Arabic letter announced another much lower price - which prompted my Lebanese father in law to spend an inordinate amount of time arguing with the ticket seller that I ought to get in at the arab rate!
...and at the resort town in Colorado where I live you can get 10% off at many places simply by announcing that you are local.
This can work in other ways, too. I regularly drive the I-77 toll road through West Virginia. Most of the traffic is out of state, so the trip amounts to a tax on people passing through an area where there are few good (fast) alternative routes. Obviously some locals pay too, but the state can easily give them a break on trip passes, etc.
This is practiced in Egypt as well--different lines and different prices for "Arabs" and "non-Arabs." This often forces some Syrians and Lebanese to communicate with the ticket taker in Arabic, which really motivates me to improve my Arabic so I can mess with their heads!
To add to your astonishment - In China they have 2 menu's, one for locals and one for foreigners ... and you guessed it, foreigners menu the price is higher.
"To add to your astonishment - In China they have 2 menu's, one for locals and one for foreigners ... and you guessed it, foreigners menu the price is higher"...
Here's the reason why...
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