In response to the post below, Matthew Schell emails:

I think your confusion derives from a faulty assumption that the price difference results from differences in the two products–either in the nutmeg itself or in the supply chains involved. But prices aren’t determined by what it costs as producer to supply a product, but what consumers are willing to pay for it. So you’d probably be better off looking for differences between who is buying nutmeg in the spice section versus in the international section.

I’d suspect the former has a higher average income and also uses the spices in question much less frequently and thus are less concerned with driving a hard bargain. I know in my case that for cheap items (like spices) I just go and get a container of it without bother to look at the price at all. Comparison shopping in order to save a couple of bucks on something I buy only once every few years just isn’t a worthwhile expenditure of my time, and it would appear the producers are taking advantage of that fact.

I should also note that my girlfriend, an economics major, also immediately emailed to tell me that she has already explained this to me. I apparently just didn’t comprehend.

Americans tend to use less spice in their foods than other cultures. Therefore, we don’t comparison shop, we don’t buy in bulk, and spice companies like the behemoth McCormick can bleed us dry. Immigrants from cultures that use a lot more spices and buy them more frequently won’t put up with that. Hence, you can find that the exact same spice selling in the “American” part of the store for five times what it costs in the International section. One reader also emailed to say that there’s a brand of chicken bullion that is the exact same product in the exact same packaging, but priced vastly differently depending on if the writing on the package is in English or Spanish.

The lesson? Buy your spices from international groceries!

This entry was posted on Wednesday, March 7th, 2007 at 6:11 pm by Radley Balko and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.