Are Canadians getting ripped off?

Question

With the Canadian Dollar and U.S. Dollar at par why do the same items cost so much more in Canada. Examples
- A McDonald's Dollar Menu item is $1:39 in Canada
- Books and Magazines have two prices on them U.S and Canadian?
- iPods, mp3 players, electronics etc cost more in Canada than US

Answer 1

Prices vary for many reasons from place to place. You will find that similar items in Europe likely cost more than they do in Canada. The only reason you are directly aware of it is because they often print the US and Canadian price on items being sold, or you see US Advertising to know what it costs in the US. Companies can charge whatever they want from Country to Country, there are no laws stating that the price charged in one place has to be the same as it is in another place. If you dont like the price the solution is quite simple- express your displeasure by not purchasing. If nobody buys, the price will drop- companies only charge what the market will bear, or they go out of business.

Answer 2

Tom, the reason is that the Canadian economy is substantially less productive than the U.S. economy, and Canadian workers are on average less productive than American workers. (Yes Canadians always get angry when I say that, but any economist in Canada would verify this well-documented and non-controversial fact of economic statistics.) THAT means that in a day of work, on average an American produces a greater value of goods or services than does a Canadian, factoring in the costs. Therefore either the American gets paid more, or the products are cheaper, or both, as compared with what happens in Canada. You also need to understand that very little about this fact is changed by the rising Canada dollar. Canadian labor and resources are PRICED in loonies, so those costs go up along with the exchange-rate value of Canadian products, for no or little net gain. Or, please correct me if all Canadian workers have agreed to a 30% pay cut to compensate for the currency -- I haven't heard of that happening yet. What this means in the real world is that comparing typical wages to prices, most things tend to be relatively more expensive in Canada than in U.S. This has always been the case, but it's more obvious to Canadians now when the two currencies are on par with each other. This is NOT a ripoff or an example of "greed". It is simply a result of Canada's economy-wide level of productivity. If you weren't comparing yourselves to America, there'd be no complaint. There is no such thing as a free lunch. Finally, if all Canadian businesses did what you seem to expect, and cut prices (and therefore sales revenues) by 30% or so across the board -- that would cause the greatest and swiftest deflation in modern history, quickly resulting in a massive Canadian depression, mass bankruptcies of businesses, runs on banks and bank failures, and unemployment easily shooting up to 25 or 30%. Why you'd want THAT to happen I've no idea.

Answer 3

The dollar just shot up within the past few years. In 2003, it was worth around 65 cents US. and within the past week, it's shot to past a dollar, but Canadian merchants bought some of their stock when the dollar was lower. Hence the big difference on book prices, for example. Then, as there was no immediate need to lower the prices (people still were willing to buy low ticket stuff like groceries), they didn't. Now, however, they realize that they'll have to. There's no reason for a Canadian to pay $1400 plus huge taxes for a front load washer in Vancouver when they can rent a van, drive to Bellingham and pay $900 US for it. They'll wisen up someday...

Answer 4

Yes ! I looked at most online sites .One even stated that Canadian orders are shipped directly from Canada and not the USA but they still wanted 3 -5 dollars more on each item .
I contacted them to ask them why this is so and lol of course they never replied!

Answer 5

In general, there is less competition in Canada than in the US. Competition is what drives prices down.

Also, for the case of electronics, you need to look at how the loonie is doing against far east currencies. IPODS, MP3 players, electronics, are not made in the US.

Answer 6

Yes we are. And I am not buying a new car until the price goes down. Porsche now sells its cars for the same price here as in the US.

Answer 7

YES!!! WE ARE getting ripped off. It's sad. We will continually be ripped off, because no one bothers to fight back. The government does not care either, they benefit from the fraud because higher prices mean they get to collect even more tax.

Answer 8

I think it's more likely that you were getting wicked good deals for the past 20 years.

Answer 9

It will take a while for the markets to adjust. It needs to remain at that level for a while before you will see prices change.

Answer 10

Not me - I'm taking advantage by shopping online from US sites :)