I live in Europe and I am often green with envy when people quote prices for Computer Hardware from Newegg or such.
Even after taking the higher Value-added-tax into account, the prices here are still on the order of 30-50 percent higher.
Arbitrage is supposed to take care of such discrepancy, why does it still exist ?
cuz most of its pry from the u.s
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cuz most of its pry from the u.s
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I used to sell video games on ebay and I was amazed of how expensive Nintendo DS games were. They are $30 US but $45-$50 US in australia and some other countries. I think a big part of that is the US is in the top 2 or 3 markets for videogames and probably computer software and hardware and that is why the prices are so cheap. In the US almost everybody has a computer.
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If after taking the VAT into account the prices are still 50% higher, then you should just consider ordering from places like Newegg and paying the shipping and import tax. We did that with some chairs and even having them shipped here from the US turned out to be cheaper than buying them in Germany. To answer your question, countries sometimes jack up prices abnormally high to encourage people not to buy imported goods, thus encouraging the economy in the home country. It’s not such a bad policy.
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I am interested in economics