Third World Economics

in 200 words.

Five things that are not significantly cheaper in the developing world, for example in the city of my birth compared to the city of my work:

1. Computers. Despite the image of India as a cheap IT supplier, the hardware is expensive.
2. Appliances and gadgets. The things that litter your home.
3. Fuel. Most of it is imported, and OPEC controls the price.
4. Clothes and food. This might surprise, but especially true of branded products.
5. Land. Obviously.

Five things that are much cheaper in the developing world, for example in the city of my birth compared to the city of my work:

1. A haircut. Fifteen pence is standard in a salon, obviously it's much less on the streets.
2. Public transport. Still less than ten pence a ride.
3. Nursing care. A couple of pounds per day.
4. Plumbers. A pound, for a job taking many hours.
5. Taxi fares. An hour's journey can cost a pound, who knows how the driver covers fuel out of that.

It's obvious really, the cheap things are services, the expensive things are products.

Equally obvious then, the people who provide the services cannot afford the products.