 With the Canadian dollar now worth more than the United States dollar and with so much of our trade being with our Southern neighbour Canadians should be feeling much wealthier. Our dollar stretches more than 50% further than it did a mere six years ago saving billions of dollars for Canadian business who import goods into this country. This of course should translate into lower prices and with price- cutting slow to materialize the impatient consumer often feels he is being ripped off. This is probably most evident in the price of books where often right on the cover the Canadian list price is often 20-25% higher than the US list price which becomes even more pronounced when currency fluctuations are factored in.
One of the key functions of the Rabbinate is to ensure the ethical running of the marketplace. With man’s insatiable appetite for acquiring money, the marketplace is ripe for exploitation; hence the need for constant supervision and vigilance, thus there are more mitzvoth relating to the economic enterprise than to any other area of Jewish law. Such communal implementation of Jewish law can only be accomplished in the State of Israel with these functions in Canadian society being handled by such agencies as the Competition Bureau etc where Jewish law is not often consulted.
As a general rule Jewish law takes no position with regard to the pricing of non necessity items. In regards to those items classified as necessity items, something not so simple to categorize but one that clearly includes basic groceries and rent, Jewish law proscribes a profit limit of not more than 1/6 - quite high for the realties of today’s marketplace where a 2-3% profit margin is often the norm. Furthermore the selling price must (coincidentally) fall within 1/6 of the actual market price even if the profit margin is very thin. As long as vendors fall within these parameters it is then up to the marketplace to determine actual pricing. Such an attitude is reflected in the rejection of the view that store owners be proscribed from offering nuts and candies to children in order to induce sales. Let the competition match such incentives if need be.
Jewish law would seem to favour the approach taken by our finance minister to try to “persuade” companies to pass on savings to the consumer. The recent announcement by Zellers that they will be reducing prices by up to 25% speaks to the power of the marketplace to regulate prices. Life, however, is never so simple. Apparently US companies are charging higher, sometimes much higher prices, to Canadian stores for the exact same product that is available at much lower prices just across the border. Distribution channels, market size, borders, business regulations, taxation laws bureaucracy and the like all distinguish the US and Canadian markets making pricing comparisons an inexact science at best thus accounting for some degree of price differentials on opposite sides of the border. Furthermore price discrimination when selling to different markets would not be in violation of Jewish law which allows for differing markets to reflect differing prices.
Nonetheless price discrimination, where different consumers in the same market are charged differing prices is morally objectionable as an unfair business practice. One may charge what one desires but charge for instance Catholics more than (or perhaps less than in order to generate additional business) Jews for no other reason than religion can not be condoned. It would be reasonable to assume that when the methods of sale differ so too may the prices. Thus online prices where there are fewer administrative costs involved, may legitimately reflect those cost differences.
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