Higher prices often accompany greater prosperity and growth in market economies, but their legitimacy depends on a public perception that they are fair and genuinely competitive.
Yesterday's documentation of price variations between Dublin and other cities and towns by the Central Statistics Office provides further disturbing evidence that this is not so in today's Ireland. Taken from the Consumer Price Index, it shows that items such as lamb, back rashers, potatoes, lager, cinema prices and ladies' hairdressers are between 11 and 30 per cent dearer in the capital. Others such as fresh fruit, dairy products, bread and flour are cheaper there. Of the 73 goods and services examined, average prices were higher in Dublin for 47 and lower for 26. In Dublin and outside, there were significant variations too between the average prices of the five lowest quotes and the five highest for most of the items included.
While the CSO says prices are determined by outlet location and size, brand and quality, many will conclude from this survey that there is unacceptable profiteering in a number of the items surveyed. Other surveys also point to this conclusion, including a recent one between selected European states in which items such as ground coffee or nappies were one third as cheap in Finland or the UK as in Ireland. Anecdotal evidence from restaurants, pubs and tourists bears out the impression that this State gives less value for money than elsewhere, notwithstanding higher rates of pay and set-up costs.
Economists often make unrealistic assumptions about consumer knowledge of price differences and their mobility when advising people to shop around for better value. On the evidence of this survey there are indeed bargains to be had. Basic information about the average real price of a pint of stout or a packet of tea bags can provide benchmarks for consumer choice. But surely it would be possible for the CSO to provide more information about price variation by detailed statistical analysis of what will now become a regular series of figures directly relevant to all consumers.
Government regulation also has a role to play in price control. Far too many sectors of the economy remain untouched by the prevailing ideology of competition. The Competition Authority is only now approaching levels of staffing and investigation adequate to its task. Consumer groups, political parties and media can do much more to expose profiteering and rip-offs. This CSO initiative should provoke more such vigilance and is a welcome addition to consumer sovereignty.