This page first posted 26 November 1998.
The question that comes up repeatedly is: "Is it really cheaper in
California?".
Some things are significantly cheaper.
All forms of alcohol are cheaper, only two-thirds the cost.
Spanish onions are almost the same as all other sorts of onions.
Cars are cheaper.
Appliances and electronics (microwave ovens, refridgerators,
printers, audio, video, cameras, computers, etc.) are cheaper.
Gas---petrol---is hugely cheaper.
Clothes can be cheaper; better use is made of remaindered or
discontinued goods, especially clothes, which are sold at
excellent prices in stores that specialise in such deals.
There are food stores that do the same, quickly moving goods near
its use-by date by offering it at prices 30% below normal.
These aren't dark, eclectically-stocked shops, they are full-scale
supermarkets--and you might not ever work out why they are
cheaper.
On the whole pricing is more dynamic, shaped by competition.
Last year's models fall in price as the new come out, perishables
drop by a factor of two or more
if it looks like they might perish otherwise.
The price asked for something depends upon the environment in
which you buy it: Macy's in the mall are much more expensive,
but their sales assistants know what they are doing; in the
discount sites (usually off the main routes) they can often barely
recognise what they are selling.
Real estate is more expensive. Here in SR, it costs the same as
Sydney, in the valley it can be much higher.
Santa Rosa is to San Francisco as Gosford is to Sydney,
giving you some idea how much more real estate costs.
Housing is very different. The process of purchase is very different,
but of comparable cost. The houses, however, are mostly wood, because it
does not fall down in earthquakes as easily as stone or brick, and it's
much lighter if it does. Houses tend to fall in value as they age,
architectural considerations aside, although
land tends to rise faster than buildings depreciate.
Houses are most commonly single story, for the same earthquake reasons.
Rent is commensurately more expensive; with current interest rates,
below 7%, rent will pay interest on a mortgage at 80% or more of the
value of the property. With tax incentives, the government is
positively bribing you to buy your own home.
Books are cheaper. I would not like to be doing these comparisons
against my situation in the UK. The price on the back of one of the
books we browsed in the bookshop late last night read: US$34.94, UK28.95.
There's about 2 US$ per pound Sterling!
The answer depends upon the exchange rate, of course. On the whole,
food costs about the same number of dollars for the same end
result, meaning that Australia is significantly cheaper on that score,
once you take an US64c=A$1 exchange rate into account.
However, salaries are also more comparable on local dollars, so
food is about the same fraction of income. The honest answer is "No",
it's not cheaper here. Engineers, however, are better recognised
in the US (and central Europe) than in Australia or England. This
means that engineers fare better here. (And so viewed from here,
Australia's pathetic international showing in marketing technology,
despite its excellent record of invention, comes as no surprise.)