Why did Beyoncé affect the cost of living in Sweden? – 06/26/2023 – Why? Economês in good Portuguese

Globalization causes price differences between countries to decrease considerably. But this is only true for products that have a relatively low shipping cost. For others, like the vast majority of services, this cost is even prohibitive. Imagine that the haircut became cheaper in Indonesia. Would anyone take a plane to enjoy the difference?

Thus, for most services, local conditions in each country still matter a great deal in determining prices. In addition, the sector is responsible for a huge portion of the world’s GDP. These two factors mean that differences in the cost of living between countries continue to be quite significant.

It is true that technology has been bringing down the costs of marketing certain services between countries. A few years ago, who would have thought that an English class could be taken remotely, with a teacher who lives in another country? But this is probably an exception. Most of the services require face-to-face contacts. Just think of the particularly devastating impact the pandemic and social distancing measures have had on the industry.

Even for other products in the economy (the so-called “goods”), there is an important component that depends on the local conditions of each country. In order for a product (such as an imported toy) to reach the consumer, it must be transported from the port to the store and sold. These transport and marketing services cannot be brought in from outside, and they impact the price of the final product.

Returning to the case of services, a music show also falls under this definition. Transport costs are very high – in addition to the ticket, an outsider would have to pay for the ticket and accommodation. Thus, tickets tend to reflect local costs in each country, which generates significant price differences between countries.

But a star of the first magnitude like Beyoncé is capable of changing that logic. A lot of people decided to pay the transport cost to attend the opening show of the world tour in Stockholm, Sweden. As a result of this influx of fans, hotel and restaurant prices in Sweden have gone up. There were even those who blamed the singer for inflation in the country being higher than expected.

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