There were two interesting proposed laws dealt with in the Knesset yesterday.
One was a proposal made by Amir Peretz regarding the prices charged in chain supermarkets. Studies have shown that the large supermarket chains tend to charge higher prices in their branches in the outlying areas than they do in the main big cities. MK Amir Peretz (Labor) sees that as a method of taking advantage of the weaker sectors of society, the normal population of the outlying areas.
MK Peretz has proposed a law by which, if it should pass, that will require supermarket chains to implement identical pricing in all the branches of its chain. Exceptions will be allowed for special sales that will run for specific amounts of time. The law will apply to supermarket chains with more than a yet-to-be-determined number of stores.
The proposal passed its initial reading in the Knesset yesterday.
I am not sure regulating prices more is the way to go. i would think finding a way to create more competition, like what is happening in bet Shemesh and some other places, will do more to bringing prices down than this will. Either this will cause the chains to raise their prices in the big cities, or just run more sales when they want to apply cheaper pricing in specific stores. I don't see how this law will change the situation significantly enough to justify a law.
The second proposal dealt with in the Knesset was the passing of a law that will now allow movie-goers to bring their own popcorn (and other snacks) into the theater, rather than requiring snacks to be bought at the theater concession stand.
The Popcorn Law was passed, and any theater administration attmepting to circumvent it and ban people from bringing in their own snacks will be liable for a fine of up to 50,000 NIS. What prompted this law was the high prices of snack in theaters. Previous attempts to regulate the maximum prices failed, so they instead formulated the Popcorn Law.
I remember bringing deli sandwiches into Wrigley Field (and other stadiums) when going to Cubs games, because besides for peanuts, drinks and maybe a couple other concessions, most of the food was not kosher. We'd sneak in a couple of Romanian deli sandwiches with pickles, and when we pulled them out to eat we'd sort of lean over to disrupt people's view of us so we would not get caught. It could not have been too difficult to sneak snacks into movie theaters, but now people can bring them in in broad daylight.
It does not seem like such an important law to me. However, we do see a trend of law proposals that are attempting to find ways to help people save money...
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These are terrible laws. There should be a law requiring MKs to pass Econ 101 before proposing laws. But what can you expect from Peretz.
ReplyDeleteOne of the reasons that outlying areas have higher prices is that it is more expensive to run those supermarkets (e.g. shipping costs). One result of the law will be that supermarket chains will be more reluctant to open stores in outlying areas, and those who live there will have fewer choices. Fewer supermarkets may also mean higher prices when the makolet is the only option.
The popcorn law is just stupid. Movie theaters make their money from concessions. If you limit their ability to sell popcorn, they will just charge higher prices for tickets.
The idea of “helping” people by imposing unreasonable restrictions on business is usually counterproductive. It’s a tiny step on a slippery slope in the direction of an economy in which an apparatchik decides the prices of goods and services. We know how well such economies have fared.