Monday, December 13, 2010

Making Flippy Floppy

            After spending most of the day picking up such essentials as curtains and incense in Bangalore’s biggest market area, which is fittingly called “Commercial Street,” my roommate, A., and I were trekking back to the house when a strap on my relatively expensive, Made-in-the-USA sandals broke.  I had actually been struggling with my sandals for a while without thinking that there might be a problem; instead, I had idiotically concluded something like “I guess I just can’t walk today.”  I didn’t give them another thought until suddenly I was barefoot.
            I picked up the sandal, looked at A., and commented, “That sucks, my sandal is broken.”
            And before he responded, an elderly Indian woman standing on the balcony above us, who neither of us had noticed, chimed in that there was a place right around the corner that could fix it.  I was a little surprised that we had been overheard, especially by someone who understood what I was saying, but gladly took her advice, loping lopsidedly in the direction she had indicated.
            We crossed the street and found the local cobbler who immediately grabbed my broken sandal and in five minutes, while we stood there, he fixed it and also reinforced the unbroken one just for good measure.  In less time than it would have taken me to pack up the sandals to ship them back to the manufacturer, which is what I would have done back in the U.S., I had a functioning pair of sandals.  And the bill, you ask?  An astounding Rs. 10, which is about $0.25, and I’m sure I was charged about twice the local rate.  A quarter!?!  That’s the price of a gumball.  Unbelievable.
            When I mentioned this to A., he remarked that “Sure, we have great access to basic services, but what happens when you get in an accident and need a high-quality hospital.  That’s the other side of the coin.”
            With that introduction, I’ll submit a very brief report on PPP in India relative to the U.S., which is a topic that oddly fascinates me.  I should really stop converting between the two currencies and just work entirely in rupees (budgets don't balance when you earn in rupees, but spend in dollars), but that process takes time.  Meanwhile, here are my observations.  For starters, food and services in India are ridiculously cheap.  Food in restaurants costs about 25% what it does in the U.S. and that is a conservative estimate.  At a fancy, high-end restaurant, you’ll pay about $4 or $5 for a main course, and at a decent place, it’ll be more like $2.  The model breaks down for street food and little hole-in-the-walls where equivalent meals in the U.S. would cost almost 10 times as much.  For example, the masala dosa I pick-up for breakfast, which is too big to finish and comes with sambar and a chutney, costs less than $0.50.  I don’t know how McDonalds or KFC make money when they are half as fast and several times more expensive than nearby local restaurants.
            Similar pricing applies to the service industry.  Just remember the cobbler.  As another example, the room I’m renting (real estate, for that matter, is somewhat more expensive than food and services though I’m still paying less than $200 a month to live in a spacious, comfortable house in one of the hottest areas of Bangalore) came with a cook/manservant named Mansingh.  I can afford a cook/manservant as a 22-year-old student because he works for a dollar a day (in total, three dollars a day counting the wages he receives from my two roommates).  Mansingh makes me breakfast and dinner, launders and irons my cloths, and cleans my room weekly.  And as long as he’s around, he’ll run out to the store and pick up whatever you want when you ask him to.  On top of all that, I really like him.  He has been gamely helping me with my non-existent Hindi and allows me into his kitchen on occasion to try my hand at making chapattis.  Eventually, he’ll interrupt my miserable attempts and tell me to eat my dinner, which is code for “let the expert take over, noob.”
            In theory, auto rickshaws should also be priced as reasonably as Mansingh is, but of course, I have to pay the paleface tax and end up getting ripped off most of the time.  I’ve started getting better at haggling and now fight in Rs. 5 (about $0.10) increments. A driver lost me as a fare this morning because I found another guy who would take Rs. 10 less.  To travel about 6 miles, I should have paid approximately $2.  Instead I paid $2.50 or so, which was much better than the initially quoted price of $4.  I think an equivalent cab ride in NYC would cost well upwards of $10.  On my last trip to India, I found arguing with the drivers exasperating and often stressful, but this time around, the same process is much less frustrating and even enjoyable at times.  It’s also been educational because for the first time in my life, I clearly understand the relationship between knowledge and power.  If you lack knowledge, the driver holds all the power.
            I don’t really understand why food (the raw ingredients) is so cheap, but restaurants and services are inexpensive because there is an oversupply of labor in India.  When I explained to my colleagues at work that one of the major reasons the Democrats were slaughtered in the midterm elections was the unemployment rate, they were astonished that 9% was considered high.  It’s an understatement that there are a lot of people in India and a lot of them need jobs.  Let’s briefly consider a restaurant.  Despite having to pay for skilled workers like cooks and waiters (remember that waiting tables in India requires impressive language skills and knowledge of food and food culture), the biggest expense reflected in your bill is the raw ingredients.  This is not the case back home.
            Incidentally, I believe that India is “cricket crazy” largely for the same reason that services are cheap.  This morning while walking around I chanced upon a large sports field filled with people playing cricket, and in the same area required for two soccer games, there were easily 50 games of cricket occurring simultaneously.  Possibly 500 people were playing on overlapping pitches where one might field a ball hit several sets of wickets away.  In a country with a surplus of people and a shortage of space, cricket makes a lot of sense.
            Anyway, droning on with my analysis of prices, we come to the section of the lecture where I discuss the exceptions to the rule that everything in India is cheaper than it is back in the U.S.  The first obvious exception is goods produced by the major international brands, which, if authentic, cost exactly the same as they do anywhere else in the world.  This applies for everything from food (think of McDonalds as a place to splurge) to clothes to electronics, which if anything, are more expensive.  The second major exception is alcohol.  One ends up paying more to buy less.  When shopping in the grocery store, the cheapest beer, Kingfisher, costs substantially more than the equivalent cheap option back home.  For wine, this is an even worse problem.  At a restaurant, the prices are much more reasonable in comparison to what they are back home, but still not something to overlook.
            Wow, I’m sorry for all that.  I can’t explain why I find price comparison so interesting.  Perhaps because buying things is one of my main modes of interaction with Indians outside of work, and therefore, it takes on some significance in my life, but now that it’s off my chest, I promise not to bring it up again.
            I’ll leave you with one short, amusing story.  The other night at the Ives party, which I’ll tell you all about it in a future post on the expat scene here, a photographer took a picture of me and two other guys who I had been talking to.  Why he was photographing us, I have no idea (well stunning good looks is a possibility I suppose), but after the photo, he came up to us, notepad in hand, and asked for our names.
            John, an American, said, “I’m John,” and the photographer jotted down “Amjon.”
            John corrected him, saying, “No, no, not Amjon.  Just John.”  And of course, the photographer wrote down, “Justjon.”  Ughh.  Lol.
My house.  Notice my roommate's sweet motorcycle.

The neighborhood cow.

3 comments:

  1. at least 3 basic prices in india from the perspective of a non local. there is the tourist price (little or no bargaining and a rip off - takes the fun out of it); the experienced traveler's price (fair, bargained for premium) and the local price. simple economics says that the more that pay the dumb tourist price, the more that price is jacked up and effectively becomes a stupidity tax on those that follow. and then there is the fun of haggling (and surely losing) with a rickshaw driver, part of the india experience.

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  2. that's about right as far as i understand it. here are my views on the subject. as foreigners in india, the dumb tourist price is what we will initially be offered (usually more than double the true price), and it's our job to work towards the local price, accepting that we will never quite make it there. that said, even bangalore locals have a hard time convincing the rickshaw drivers to charge meter, which is what they are legally required to do, so i don't feel so bad if i pay up to 50% above it. i would actually recommend insisting on "1 and a half meter," which will always be a better price than the offerred one, but is usually a bargain that drivers respect. if you can go lower, do it. basing the price of a trip on the meter is usually the way to go unless you know exactly where you are going and how much the trip should cost. then a fixed price can be both cheaper and faster as the incentive now is for the driver to get you out of his rickshaw instead of keeping you in his rickshaw as he takes you the most roundabout route to your destination in order to bump up the fare. it's all about incentives.

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  3. for the sake of completeness, i just want to add a few more things to the list:
    gas is twice as expensive here as it is at home
    foreign luxury cars are 1.5 times as expensive so when you see a porsche rolling around, it means that little bit more...
    cellphone service is really cheap. i have a pay-as-you-go phone. on local calls, i pay 1 paisa a second, which works out to about 2 cents a minute. local texts are free.

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