Economics and the mid-life crisis have much in common: Both dwell on foregone opportunities

C'est la vie; c'est la guerre; c'est la pomme de terre . . . . . . . . . . . . . email: jpalmer at uwo dot ca

. . . . . . . . . . .Richard Posner should be awarded the next Nobel Prize in Economics . . . . . . . . . . . .

Thursday, March 17, 2005

Gender Pricing.
Is It a Sign of Discrimination?

Earlier this week, the CBC and the Globe & Mail both reported on a private member's bill, introduced in the Ontario Legislature, that would prohibit hair stylists from charging more for women's haircuts than for men's haircuts. It would also prohibit dry cleaners from charging more for finishing women's shirts than men's shirts.

Women across the country are overcharged a total of $750 million for their hairstyling alone, according to Joanne Thomas Yaccato, a marketing consultant.

The bill, which would impose fines of up to $5,000 for charging
women more than men, will be debated on April 14.

This is the kind of nonsense that ensues when people do not understand competitive markets. Dry cleaners and hair stylists are in some of the most competitive businesses there are. If some firms are somehow and for some unexplained reason exploiting women, others will surely offer lower prices. The potential for competitive pricing in these industries leads me to believe that gender differences in pricing are almost surely cost-determined.

My barber, in Blyth, Ontario, charges $3 for men's haircuts. I don't know what he would do if a woman wanted a haircut for the same price. Our local dry-cleaner charges the same for men's and women's slacks.
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