The Pink Tax

It’s beyond a myth but a well-documented fact that consumers pay more for products targeted at women than other products. We are well aware of the difference between the average 2-blade pink razor compared to the 5-blade blue which often costs less. Planet Money’s the indicator looked at the price of low-end razors and found that women pay on average 125 cents per unit, whereas men pay only half that at 60 cents per unit. This difference in price is not purely seen in hygeine products, though there is an approximately 13% difference in prices between male and female products. In clothing, there is an 8% difference, which is also present in health items such as medical equipment. There is also a 7% difference in children’s toys. These diffrrences are expected to cost women an excess of $1300 USD per year. When you remember we only earn 79 cents on the man’s dollar you can see why we see it as stealing money out of our pockets. In a number of US states the practice of price discrimination is legal though in some states like NY there are restrictions surrounding price discrimination (economist jargon) in certain services. Australia has also recently passed legislation abolishing the 10% ‘tampon tax’ (GST) on sanitary products, no longer classifying them as a luxury item.

So why do women’s products cost more?

There are a number of reasons that the price of women’s goods and services are often inflated in price. The first factor to consider is that the good or service may be more costly in time, skill or value. For example, hairdressers often charge women far more than men for a haircut. Though the required skill level of the hairdresser may vary. Women also often require a more complicated cut or a colour. A similar effect may be seen in clothes, where women’s clothes may cost more due to them using more expensive fabrics or more fabric. However, this is a marginal number of cases. A lot of the time companies use price discrimination to target the same product to different audiences.

The issue of price discrimination has a number of causes, firstly that women are thought to be far more brand loyal than men. This means choosing a well-trusted, more expensive brand product over a cheaper product with no knowledge of its quality. This means there is a greater market share in women’s products and so there’s more advertising targeting women. Don’t stress if you feel like a fish caught in a corporate net – we all are. I mean who convinced us to remove body hair? It’s expensive and painful – but excuse me while I go shave my netherregions for the third time this week.

Another idea is that women’s products are a form of self-expression that help to establish their femininity through the consumption of products and services.

Is that all?

Heck no! Women are on the butt end of everything – have you even being paying attention? Another facet of being female is the dreaded late night travel home while inebriated. Most women in major cities find that public transport at this time can feel unsafe and so opt for other methods of transport such as uber or taxis. This is far more costly than a single transit ticket, which may total an excess of $50/month of travel for women.

This cost doesn’t even include the cost of travelling with children which is ever more expensive and often rests on women in families.

Ugh what’s the point?

Men often also face extra costs particularly when going out to clubs where women are often given free or reduced price for entry. Hooray!

But it’s not all dreary, economists are always on the hunt for challenging questions to help solve and implement into government policy. The pink tax is no exception and is slowly changing worldwide.

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